Crude Oil has been on a bullish trend for two years, since US WTI crude dived to $-37.50 as US producers were left with no storage space to store their crude production. Oil kept moving higher until it got close to $100 by late February. Then came the surge after the tensions in Ukraine and the sanctions by the US on Russian oil and gas.

But Europe and the rest of the world didn’t follow the US administration, probably because Russia is threatening to accept only Rubbles for gas at the moment. So, WTI crude oil fell below $100 by the middle of the month but started moving higher again last week, climbing to $117. Although, in the last two days we have seen a swift reversal down.

US WTI Oil Daily Chart – Oil Making Lower Highs

Will the 50 SMA turn into support for oil?

The price of the US WTI oil tumbled below $100/barrel level. yesterday the lockdown of the Shanghai province in China was the main reason for the bearish reversal, while today hopes for peace have pushed the price sharply lower over the last few hours. The high price for the day reached $107.81 before reversing back to the downside.

Looking at the daily chart, the high price did stall near the 38.2% retracement of the move up from the March 15 swing low down at $93.56. The next high price is all the way up to $116.61. The 38.2% retracement of that move comes in at $107.73. Also near the high was the 200 hour moving average at $108.24. Finding sellers near those technical levels kept the sellers more in control. Of course the news helped to reverse the trend.