Oil prices mired in a bear market are continuing their declines as bearish technical indicators signal further pain.
Brent crude in London, the marker for more than half the world’s oil, slipped below the 38.2 percent Fibonacci retracement support level of $62.27 per barrel earlier on Friday, extending its losses to $61.99 at 11:33 a.m. Singapore time.
U.S. oil benchmark is facing more selling pressure as West Texas Intermediate crude’s 50-day moving average fell below its 200-day moving average, forming a bearish pattern known as death cross. Futures in New York slumped as much as 3.3 percent to $52.82 a barrel Friday, on course for a seventh consecutive weekly decline.
“We did hit and breach some technical support areas so we might see some scrambling out of longs,” Michael McCarthy, chief market strategist for Asia Pacific at CMC Markets in Sydney, said by phone. “It looks like we’re having another wobble.”
The benchmarks both collapsed into a bear market this month, joining a rout in equities around the globe, as fears over a supply glut mounted after the U.S.’s temporary waiver allowed Iranian oil to continue flowing into the market.