30-mins: Oil Broke below Support Over the past couple of weeks, investors have been actively shorting oil, shifting their capital towards Bitcoin and leading tech stocks from the US100 (Nasdaq 100). This capital reallocation has put significant downward pressure on oil prices, which initially found temporary support around the $68 mark. However, this support level failed to hold, triggering a sharp and rapid decline as bearish momentum accelerated.
A notable technical signal has emerged in the form of a "Death Cross," where the 20-period moving average (MA) crossed below the 60-period MA. This crossover is a strong bearish indicator, suggesting that the current downtrend may persist, with sellers firmly in control. Currently, immediate resistance is found at the $67.20 level, corresponding to the 23% Fibonacci retracement, but the downward bias remains strong.
Despite this, the lower price levels might attract short-term buyers looking for value opportunities. However, a more conservative selling point for traders eyeing the ongoing downward momentum would be at the $67.88 level, aligning with the 50% Fibonacci retracement. This level offers a better risk-reward entry for short sellers, allowing them to participate in the trend while managing potential pullbacks.
