WTI Crude Oil Prices May Bounce After 17% Five-Day Drop

WTI Crude Oil Prices May Bounce as Bears Get Weary

The price of West Texas Intermediate (WTI) crude oil has dropped by 17% in the past five days, but analysts believe it may be due for a rebound. With prices stabilizing above a support cluster and holding up against US dollar strength, the path of least resistance could be higher.

According to FOREX.com analyst, WTI closed at a four-month high on September 15, but the rally was short-lived. The bearish mean-reversion that followed has now given way to a potential bullish reversal pattern. The daily chart shows a 'tweezer bottom' around the 50-day Exponential Moving Average (EMA), indicating that bulls may be accumulating.

WTI crude oil positioning data from the NYMEX and CFTC also suggests that large speculators have been net long 136,000 contracts, though this is largely unchanged from the previous week. However, total open interest has been rising alongside the rally, indicating a robust rebound.