WTI crude oil recently busted through its descending trend line on the 1-hour chart to signal that a reversal from the slide is in order. Price could still retest the broken resistance to gather more bullish energy.

Applying the Fibonacci retracement tool on the latest swing low and high shows that the 50% level is close to the broken trend line, which might now hold as support around $59.33 per barrel. A larger pullback could dip as low as the 61.8% Fib at $58.84 per barrel while a shallow correction could already find buyers at the 38.2% Fib.

Price is also finding some support at the 100 SMA dynamic inflection point, although this moving average happens to be below the 200 SMA so there’s still a chance that the selloff could resume. The gap between the indicators is also widening to reflect strengthening selling pressure.

Stochastic is pointing lower to show that sellers have the upper hand, especially since the oscillator has plenty of room to move south before reflecting exhaustion among bears. RSI also just turned lower from the overbought zone to show that sellers are just taking over and could stay in control for much longer.

WTI crude oil could enjoy upside pressure as the blockage in the Suez Canal could limit exports of the commodity globally. This could mean lower supply, which adds to the OPEC+ decision to extend their output deal by a few months.

Meanwhile, demand could pick up as stimulus efforts kick in and vaccination programs see some success. This could provide support for business and consumer activity, which then translates to stronger purchases of fuel and energy commodities.

Risk aversion, on the other hand, could bring sellers back in as traders are also keeping tabs on the resurgence of COVID-19 cases in several parts of the globe.