WTI crude oil looks ready to resume its slide without even pulling up to close the weekend gap. Applying the Fibonacci extension tool on the correction shows the next potential downside targets.

The 38.2% level is at $28.18 per barrel and also lines up with the swing low. The 50% extension is at $25.67 per barrel then the 61.8% level is at $23.17 per barrel. Stronger selling pressure could take it down to the 78.6% level at $19.61 per barrel then the full extension at $15.07 per barrel.

The 100 SMA is below the 200 SMA to indicate that the path of least resistance is to the downside or that the selloff is more likely to gain traction than to reverse. The gap between the moving averages is also widening to reflect stronger bearish momentum, and price is below both indicators to confirm the presence of selling pressure.

RSI is pointing back down after reaching the center line, suggesting that sellers aren’t quite done yet. Stochastic is also turning lower without even reaching the overbought zone, which means that sellers are eager to return before buyers are even exhausted.

Crude oil remains under downside pressure while coronavirus risks prevail, as this would mean more trade and travel restrictions. Not only does this dampen risk appetite and business sentiment, but it also hurts demand for fuel and energy commodities.

It doesn’t help that the OPEC can’t get Russia on board with an agreement to trim output, spurring an oil price war among producers. This could continue to drag crude oil prices further south until the major producers stage a joint effort to prop prices higher.

Traders are also taking cues from the inventory data released by the EIA, which revealed a larger 7.7 million barrel increase in stockpiles versus the projected gain of 2.0 million barrels.