WTI Price Forecast: Trades with modest gains below $60.00; not out of the woods yet

• WTI attracts some buyers during the Asian session, though it lacks bullish conviction.

• The technical setup backs the case for the emergence of fresh sellers at higher levels.

• A breakout through the trend-channel hurdle is needed to negate the negative bias.

West Texas Intermediate (WTI) US Crude Oil prices edge higher during the Asian session on Friday and for now, seem to have snapped a four-day losing streak to an over two-week low, touched the previous day. The commodity, however, remains below the $60.00 psychological mark, warranting some caution for bullish traders and before positioning for any meaningful positive move.

From a technical perspective, the black liquid has been trending lower along a downward-sloping channel since late October. Moreover, overnight breakdown below the 100-period Simple Moving Average (SMA) on the 4-hour chart suggests that the path of least resistance for Crude Oil prices remains to the downside. Hence, any subsequent move up is more likely to attract fresh sellers near the $60.30 region.

A sustained strength beyond the latter could lift the commodity further, though it is more likely to face stiff resistance and remain capped near the trend-channel hurdle, currently pegged near the $60.65 region. Some follow-through buying, however, might negate the near-term negative outlook and trigger a short-covering rally, which should allow Crude Oil prices to aim towards reclaiming the $61.00 round figure.

On the flip side, the $59.00 mark could offer some support ahead of the overnight trough, around the $58.75 region, below which Crude Oil prices could challenge the lower end of the descending channel, currently around the $58.35 zone. A convincing break below the trend-channel could make the commodity vulnerable to slide further below the $58.00 mark, towards the next relevant support near the $57.40-$57.35 region.

WTI 4-hour chart