WTI Price Analysis: Rebounds from 50% Fibo./100-period SMA confluence support

• WTI crude oil prices attract some buyers near the $84.50-$84.25 confluence on Monday.
• A convincing break below the said support will pave the way for further near-term losses.
• Sustained strength beyond the $86.35 region is needed to support prospects for further gains.

WTI crude oil prices regain some positive traction on the first day of a new week and hold steady above the $85.00 mark heading into the European session.

From a technical perspective, the commodity manages to defend the $84.50-$84.25 confluence comprising the 100-period SMA on the 4-hour chart and the 50% Fibonacci retracement level of the $76.08-$92.63 rally. The said area should now act as a key pivotal point, which if broken decisively will set the stage for an extension of the recent sharp pullback from the highest level since August touched last week.

In the meantime, any subsequent move up is likely to confront some resistance near the $85.70-$85.75 region. This is closely followed by the $86.00 mark and the 38.2% Fibo. level, around the $86.30 area, above which spot prices could climb to the $87.00 round figure. The momentum could get extended towards the $87.45 hurdle en route to the $88.00 mark and the 23.6% Fibo. level, around the $88.55-$88.60 supply zone.

On the flip side, weakness back below the $85.00 round figure might continue to find decent support near the $84.50-$84.25 confluence. A convincing break below will be seen as a fresh trigger for bearish traders and pave the way for additional losses. WTI crude oil prices could then weaken below the $84.00 mark and test the next relevant support near the $83.40-$83.35 region before eventually dropping to the $83.00 level.

WTI 4-hour chart

Key levels to watch