Oil suffers another beating again, down over 4% on the day

The recent fall in oil was somewhat defended around $88, near the 61.8 Fib retracement level at $88.04 and we are seeing that be called into question again today. Oil is being taken to the dumps after the recent bounce at the end of last week failed to get above $95 and its 200-day moving average (blue line).

Recession worries are a key headwind for oil at the moment and the latest headlines from China today will provide very little comfort on that front. All of this just adds to the recent controversy over the data that is also helping to drive sentiment in the oil market. Adam had a good post on that at the start of this month here.

Anyway, the technicals are now doing the talking for oil and if we do see a firm break below $88 then that will open up room to roam to the downside towards $80 next.