WTI down 1.4% to $77.29 at the moment
The low today hit $77.08 and that is the lowest since 7 October as oil prices continue to struggle after failing to really secure a firm break above $85 in recent weeks.
As pointed out last Friday here, three straight consecutive weekly declines and a relative top at $85 looks to hint at exhaustion signs in oil and we're seeing that come into play as price tumbles to its lowest in six weeks today.
For all the talk of oversupply in Q1 2022 and the threat of SPR release, the technicals also say a lot when it comes to identifying the latest downside push.
I'm still an oil bull in the bigger picture but I would argue that the latest retreat here has more room to run in the short-term. The medium-to-long-term fundamentals for oil is still very much intact with OPEC+ not shaking things up and with the global economy set to improve further next year, adding to a relatively tight market at the moment.
But timing is everything and all this talk of strategic reserves selling and what not isn't a pretty colour that is painted on oil market sentiment, adding to the technical exhaustion.
A flush back towards $74 near its 100-day moving average will perhaps be one to look out for as being the first point of contention for buyers to step back in but any major dips below that and closer towards $70 will present rather good opportunities to scale back in on long positions heading into next year in my view.
