Crude Oil rallied for two days but yesterday it reached a top at the 100 SMA (green) and it reversed lower, as OPEC’s decision to cut output in October was countered by concern about a weak global economic outlook and the prospect of more interest rate hikes from central banks. OPEC and allies led by Russia, known as OPEC+, decided to cut deliver an output cut of 100,000 barrels/day after Saudis and Russia voiced concern about a slump in prices since June.

“The decision to reverse the 100,000 barrel per day increase in September was more symbolic than fundamentally significant,” said Craig Erlam, an analyst at brokerage OANDA. “But it will make traders think twice about driving prices lower in the way they have recently.”

Crude Oil H4 Chart – The 100 SMA Rejected Oil Yesterday

Oil aiming for new lows now after the reversal 

The price climbed around $4 since Friday, but comments from the White House that US President Joe Biden was committed to taking all steps necessary to shore up energy supplies and lower prices, weighed on Oil prices as well. Oil reversed back down and today we are seeing another selloff period. We decided to open a short-term sell Oil signal earlier today, which closed in profit pretty quickly as the decline accelerated.

WTI Crude Oil Live Chart