FxWirePro: US Oil struggles to extend bullish gap open, bias still bearish

U.S. Oil chart on Trading View used for analysis

• WTI opened with a slight bullish gap, but is struggling to find follow through upside momentum.
   
• The trend still bearish with no signals of a reversal despite momentum indicators at oversold readings. 
   
• Markets skeptical whether the planned supply cuts by the OPEC and other producers such as Russia will be able to stabilize the oil markets.
   
• OPEC and allied oil producers said that they will do what is needed to balance the market next year.
   
• Price action below cloud and major moving averages, extends weakness below 200-W SMA.
   
• We see scope for test of major trendline support at 42 mark. Violation there could see further weakness.
   
• On the flipside, breakout at 5-DMA could see gains upto 21-EMA at 49.48.

Support levels - 42, 39.17 (Aug 1, 2016 low)

Resistance levels - 44, 44.91 (5-DMA)

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