Recovery loses traction despite lowered production in Libya and Iraq
WTI oil price eases from he session high ($59.62), hit after gap-higher opening on Monday, on rising concerns about supply as unrest in Libya and protests of workers on oil installations in Iraq, reduced production in both countries.
Fresh price easing signals that immediate fears start to fade, as global oil market remains well supplied from the output and crude stocks.
The price returned below initial barrier at $59.15 (10DMA), with daily close below, to generate negative signal and risk retest of 200DMA ($57.64) which contained recent strong pullback from new multi-month high ($65.43).
Daily studies are mixed (momentum remains firmly in negative territory; stochastic heads north; RSI is flat and MA’s in mixed setup) and lack clearer direction signal.
Pivotal barriers lay at: $59.15 (10DMA); $60.29 (20DMA) and $60.48 )Fibo 38.2% of $65.43/$57.42) with break above the latter to confirm higher low ($57.42) and signal further recovery.
Conversely, loss of supports at $57.64/41 (200DMA / daily cloud top) would weaken the structure and risk further easing towards $56.46 (Fibo 61.8% of $50.91/$65.43 upleg).
Res: 58.59; 59.62; 60.00; 60.48
Sup: 58.75; 58.17; 57.64; 57.18