WTI crude oil futures closed down $0.79 at $63.17. The lowest price of the day was $63.06, and the highest was $64.34. The price is drifting away from the 100-hour moving average of $64.82 and has dropped below a support level of $63.61, with a swing high at $65.27. If the price bounces back above these levels, it could indicate a shift back to buyers.

Support and Resistance Levels

If the price does not bounce back, sellers will remain in control, with the next target near the May lows around $60. Further declines could bring focus to the April and May lows close to $55.15. On August 12th, 2025, WTI crude oil fell below a key support area of $63.61. The price is moving away from its 100-hour moving average, suggesting bearish sentiment is increasing. For a recovery to happen, the price needs to reclaim the $65.27 level, but this seems unlikely at the moment. This downward trend is supported by recent news. Last week’s EIA report revealed a surprise inventory increase of 2.8 million barrels, contrary to expectations. Additionally, recent purchasing managers’ index (PMI) data from Europe and Asia revealed a slowdown in manufacturing, raising concerns about future energy demand. High U.S. shale production throughout the summer has also contributed to increased global supply.

Bearish Trading Strategies

For traders using derivatives, this indicates a potential opportunity to set up bearish positions in the coming weeks. We are eyeing the May 2025 lows near the $60 mark as a significant target. Strategies like buying put options with a $60 strike price or starting bear call spreads could be effective ways to profit from this expected decline. If the market continues to weaken and drops below the psychological $60 support, the next major downside target would be near $55.15, based on the April and May 2025 lows. This kind of price drop has occurred before, particularly during the economic slowdown in late 2024, when oil prices fell nearly 15% in one quarter. The current situation appears similar, driven by real fundamentals rather than short-lived headlines. The main risk to this short-term bearish outlook would be a sudden rebound above the 100-hour moving average at $64.82. A consistent move above the $65.27 swing high would suggest that buyers are regaining control. Therefore, it’s crucial to monitor any short positions against these key technical levels. Create your live VT Markets account and start trading now.

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