WTI with key support breakout! What's next?

It seems that, in full circumstance of the geopolitical situation, oil has been falling down a bearish market day after day. The decline in black gold was dictated by the US decision to allow some of Iran's largest customers to continue to import their oil without violating sanctions.

In the long term, expectations of lower global economic growth in the face of a continuing US-China trade dispute, as well as weaknesses in emerging market exchange rates, raise concerns over oil demand.

Technically, WTI activates the Double Top formation on a weekly chart that is worth looking at. After the categorical breakthrough of the support zone, formed by 38.2% Fibonacci on the last upward trend, the formation line and 50SMA, short positions seem to be the most appropriate option.

The Double Top target is in the range of around $54/$55 per barrel, but you'll probably see a slight rewind of the 50% Fibonacci on the last upward wave, coinciding with the diagonal trend support starting in the summer of 2016.

Taking positions from current levels will be too risky, so it's a good idea to wait for a new test of Neckline or price penetration in the figure. Statistics show that in most cases, when activating this type of formation, the price tests 50% of it. In this case $70.56. For this reason, even if we monitor a repeat test of Neckline , it is good to divide the volume into 2 stages of positioning.

Entrance with 50% of the volume in the Neckline test and SL over 50% of the figure and addition of another 50% when the price reaches $ 70.56 per barrel.

Alternative Scenario: If the price exceeds 50% correction of the figure, a negative scenario will be spoiled and more likely to see an increase in the value of the oil. There are currently no fundamental news to support growth.

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