WTI Crude Oil Prices Dropped Below $20.00 Handle – COVID-19 Disrupts Demand
Today in the Asian trading session, WTI crude oil prices continued to flash red and represented 0.15% declines on the day, having faced rejection at $20.80 during the overnight trade. The prices dropped to the low level at $19.92 on Tuesday after Saudi Arabia cut its official selling price for Asian customers for May in order to capture market share before output cuts take effect from May 1.
At the moment, WTI crude oil is currently trading at 19.59 and consolidating in the range between 19.21 and 20.89. US crude oil prices dropped below the $20 a barrel in response. The global oil demand is expected to drop by a record 9.3 million barrels per day in 2020 as the COVID-19 pandemic brings mobility – and consequently, fuel demand – almost to a halt, the International Energy Agency said on Wednesday.
These factors, along with the bearish API inventory report, are likely keeping oil prices under pressure during the Asian session. The American Petroleum Institute on Tuesday predicted a large crude oil inventory build of 13.143 million barrels for the week ending April 10 compared to expectations for a build of 11.676 million barrels.
Daily Support and Resistance
S1 22.02
S2 24.59
S3 25.69
Pivot Point 27.17
R1 28.27
R2 29.75
R3 32.32
The technical side of crude oil remains mostly the same as it may find an immediate resistance around 23.66 area, and closing of candles below this may drive selling bias until 19.20. A bullish breakout of 23.66 can lead WTI prices until 28, while the bearish breakout of the double bottom support level of 19.20 level can extend selling bias until the next support level of 17.53. We may not see any further trend until this particular range gets violated. Odds of bearish breakout remains high today.
Good luck!
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