Oil attempts to extend recovery but key barriers still intact
WTI oil price rose on Tuesday, supported by report that OPEC+ group’s output stays below limits agreed and that cartel’s production cut was so far exceeded by more than 50%.
Adding to positive signals was the OPEC report which suggests that Iran keeps its oil away from the market.
Positive signals, however, were insufficient to inflate oil price more to break above a cluster of converged falling daily MA’s (5/10/20) between $54.61 and $54.96, following Monday’s strong rejection at this zone.
Daily studies are conflicting as bullish momentum continues to rise, MA’s are in full bearish configuration, while Stochastic and RSI are flat, lacking clearer direction signal.
The downside is expected to remain vulnerable while the price holds below these moving averages, while break and close above would improve near-term structure for further retracement of $57.11/$52.95 bear-leg.
Markets focus US crude stocks reports, with API report due later today and EIA weekly crude inventories on Wednesday, which would generate fresh signals.
Res: 54.61; 54.82; 54.96; 55.38
Sup: 53.93; 53.70; 53.23; 52.95