The worse than expected tariffs announcement on Wednesday triggered recessionary fears in the markets. Crude oil was one of the markets most affected by that news as OPEC+ continues to hike supply. So, we have both higher supply and lower demand expectations obviously leading to lower prices.

Moreover, OPEC+ yesterday surprised with a bigger boost to production than previously expected which exacerbated the selloff in crude oil. On the 1 hour chart below, we can see the catalysts that led to the selloff.

On the weekly chart below, we can see that the price is approaching the key support zone around the 62-64 price region. That’s where we can expect the buyers to step in to position for a rally back into the 75 level (although the fundamentals remain strongly bearish for now). The sellers, on the other hand, will look for a break lower to increase the bearish bets into the 50 handle next.

This article was written by Giuseppe Dellamotta at www.forexlive.com.