Oil Drops on Monday
28 March 2022
The WTI benchmark was down more than 3% on Monday in what is considered average volatility nowadays, testing the 110 USD level to the downside.
Oil has failed again at the 118 USD resistance as investors took profits from the recent rally. As long as it trades below 118 USD, the short-term outlook could be cautiously bearish.
On the downside, the critical support zone is at the medium-term uptrend line, currently near the psychological level of 100 USD. Therefore, oil must defend it in order to stay in the long (and medium) term uptrend.
The US dollar is soaring today, along with US yields, undermining commodities such as gold, silver, copper, and oil are all weaker.
On Sunday, China announced that a two-phase lockdown for Shanghai had been launched amid the rising number of coronavirus infections. More lockdowns in China could decrease demand for oil in the short term.