WTI has slipped back to the $58.00s to test its 50DMA for the second time in four sessions. Traders continue to attribute concerns about crude oil demand in Europe as a negative as the continent returns to lockdown. The price of the front-month WTI futures contract has slipped back to test its 50-day moving average (which sits at $58.74) for the second time in four trading days, after the crude complex came under heavy selling pressure in the early part of European Tuesday trade. No particular theme or news was behind the selling pressure, which seems instead to have been caused by a pickup in US dollar strength – WTI typically has a negative correlation to USD as when USD strengthens, it makes dollar-denominated WTI more expensive for purchase internationally. At present, WTI trades with losses of nearly 4.0% or about $2.50 on the session. A break below the 50DMA, which seems very possible given the amount of bearish momentum WTI seems to be carrying on Tuesday, could open the door to an extended move all the way back down to the next key area of support which is around the $54.00 level. Alternatively, WTI might instead find support at last week’s low-$58.00 lows, which could set the stage for a gradual recovery back towards the 21DMA at above $63.00. Driving the day As noted above, the strengthening US dollar appears to be the main factor behind WTI’s poor performance. Other than that, it is difficult to say why the crude complex is performing so poorly. Market commentators are chalking the ongoing losses to continued concerns regarding the state of the pandemic in Europe; Germany (Europe’s largest consumer of oil) is extending lockdown measures for a fifth time as expected and is set to implement very tight restrictions over the Easter period, the country moving in lockstep wither major European economies such as France and Italy who have also recently toughened lockdown restrictions. Moreover, while the UK’s vaccination programme continues to go very well, as clearly evidenced by the sharp drop in Covid-19 related deaths in the country every day (the hope is that with practically all the vulnerable in the UK having now been vaccinated, the Covid-19 death toll going forward should be very low), government ministers and officials continue to talk about travel bans to Europe. The UK fears that strains of the virus might arrive and prove more resistant to vaccine-acquired immunity, which could put the country’s roadmap to reopening in jeopardy – but this means less jet-fuel demand for touristic purposes, a big drag on crude oil prices. Looking ahead, Private Weekly API crude oil inventories will be released after 20:30GMT and ought to provide some further impetus for crude oil markets – the fear is that with the WTI futures time spread in Contango over the next few months, this could lead to inventory builds, which would be a further bearish impulse for crude prices. Fed speak from a variety of officials will also be worth watching just in case is impacts USD and thus crude oil. FX Street FX Street FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market. It was launched in 2000 and the portal has always been proud of their unyielding commitment to provide objective and unbiased information, to enable their users to take better and more confident decisions. View All Post By FX Street FXStreet News share Read Next AUD/NZD Price Analysis: Breaks key resistance, eyes 1.1000 FX Street 2 years WTI has slipped back to the $58.00s to test its 50DMA for the second time in four sessions. Traders continue to attribute concerns about crude oil demand in Europe as a negative as the continent returns to lockdown. The price of the front-month WTI futures contract has slipped back to test its 50-day moving average (which sits at $58.74) for the second time in four trading days, after the crude complex came under heavy selling pressure in the early part of European Tuesday trade. No particular theme or news was behind the selling pressure, which seems instead to have been… Regulated Forex Brokers All Brokers Sponsored Brokers Broker Benefits Min Deposit Score Visit Broker 1 $100T&Cs Apply 0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 9.8 Visit Site FreeBets Reviews$100Your capital is at risk.2 T&Cs Apply 9.8 Visit Site FreeBets Reviews$100Your capital is at risk.3 Recommended Broker $100T&Cs Apply No deposit or withdrawal feesTrade major forex pairs such as EUR/USD with leverage up to 30:1 and tight spreads of 0.9 pips Low $100 minimum deposit to open a trading account 9 Visit Site FreeBets ReviewsYour capital is at risk.4 T&Cs Apply Visit Site FreeBets ReviewsYour capital is at risk.5 Recommended Broker $0T&Cs Apply Trade gold, silver, and platinum directly against major currenciesUp to 1:500 leverage for forex trading24/5 customer service by phone and email 9 Visit Site FreeBets ReviewsYour capital is at risk.