- WTI recovers a part of Friday’s sell-off, with eyes on oil reserves release.
- The US oil is supported above the 100-DMA of $73.86 on the 1D chart.
- RSI sees a fresh uptick but remains below the central line.
WTI (NYMEX futures) is making a recovery attempt on the $76 level after falling as low as $74.64 earlier in the Asian session on Monday.
With the rebound, the US oil reverses a small portion of Friday’s steep sell-off, led by the European covid lockdowns and a potential release of the oil reserve by major global economies, including the US, China and Japan.
From a short-term technical perspective, WTI has stalled its correction from multi-year peaks just above the 100-Daily Moving Average (DMA) at $73.86.
The rebound comes in tandem with the 14-day Relative Strength Index (RSI) also recovering from almost two-month lows.
Despite the renewed uptick in the RSI, the indicator continues to trade within the bearish territory, suggesting that any recovery is likely to remain short-lived.
A daily closing below the 100-DMA could open floors a sharp tumble towards the ascending 200-DMA at $69.42.
Ahead of that level, the $70 round figure could offer some reprieve to WTI buyers.
WTI: Daily chart
Alternatively, any recovery attempts could meet the initial supply at the $77 level, above which the upward-sloping 50-DMA at $78.36 would get tested.
Should the recovery momentum sustain then WTI bulls could look out for the next resistance at the bearish 21-DMA at $80.45.