US oil trying to defend the 20 USD threshold


Oil is down another 2% on Wednesday, and the WTI benchmark is trading at around the essential 20 USD level.

It looks like the historic OPEC+ deal to cut production has failed to stop the decline, and oil has dropped more than ten %since the decision.

If the 20 USD support is broken to the downside, and it looks like it will very soon, stop--losses of long positions defending this level will be triggered, which could push the price of oil lower, targeting the 18 USD barrier in the initial reaction. The next support could be at 15 USD.

Oil will probably move quickly higher once the economic situation improves in the world, thus initiating long positions at these prices might be a very viable option for long-term investors. 

The resistance seems to be at around 22 USD, and if broken, oil could rally toward the 25 USD. That would be positive news for equity investors, but so far, it seems the bearish trend will continue.
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