Crude Oil has turned quite bearish. it moved higher in December, after OPEC+ decided to place further production quotas for an additional 50k barrels/day. The year end cash flows which weakened the USD also helped crude Oil and on top of that, the tensions between US and Iran increased fears for an Oil production/supply disruption in the Middle East.

That helped Oil further in the first week of this year, but it started retreating lower, as the sentiment improved. But, the coronavirus breakout scared the hell out of everyone and the sentiment turned massively bearish for risk assets, such as crude Oil.

US WTI crude lost around $16 from top to bottom and moving averages turned from support into resistance. OPEC+ was thinking about cutting production further by an additional quotas of 500k, But Russia doesn’t like that, since it would decrease their revenue.

So, Oil has remained bearish, but today it has made a retrace higher, as the sentiment improved on coronavirus comments.  Crude Oil broke above the 20 SMA (grey) on the H4 chart, as shown above. But, the retrace seems complete now and the price is retreating back down as the 50 SMA (yellow) approaches. We decided to open a sell signal below the 50 SMA, so now we are bearish again in Oil.