Oil price fell sharply on Tuesday over worries that the oversupply problem will hit investors’ confidence ahead crude oil inventory which is expected to show a rise in crude oil supply.
West Texas Intermediate weakened about 2.88% (about $1.29) to $43.49 per barrel by 16:31 GMT.
The fall of WTI on Tuesday marked a three days-in-a-row decline. WTI has risen about 66% since it hit the lowest level in February, but it has fallen more than 5% this week.
Oil price currently is capped by negative trendline as we can see on the hourly chart. It remains under pressure, moving in bearish bias for short to mid-term trend. It currently is testing intraday key support at 43.45. If the price managed to break the support, the oil price is expected to fall deeper to 42.81-42.36.
On the other hand, hourly stochastic and CCI are oversold. As alternative strategy, watch for bearish signal confirmation on a pull-back move to within the Fibonacci resistance area at 44.11-44.58 to go short with 43.82 as target and 43.35 in extension.
Be careful if the resistance at 44.58 breaks because it will turn the intraday bias to bullish and possibly will be followed by a bullish move up to 44.91-45.34.