Oil price in recovery mode but stronger positive signal could be expected on regain of $20 level
WTI oil price remains in green on Thursday and attempts to extend recovery from the record low posted after Tuesday’s crash.
Signs that producers are cutting output in reaction to collapsed demand on coronavirus lockdown and start of OPEC+ 9.7 million bpd reduction from 1 May, revived optimism and prompted market speculators into fresh buying that inflated oil prices.
However, there is still long way towards signs of reversal, as studies on daily chart are still in firm bearish setup and full storage places around the world warn that current advance is temporary.
Wednesday’s data showed that US crude stocks rose by 15 million barrels last week and remaining near the record rise of 19.2 million barrels previous week, adding to signs that situation in the oil sector is still very weak, as a number of oil companies are near the closure.
Recovery needs to regain minimum $20 zone (former key supports) in order to ease bearish pressure and generate fresh bullish signals.
Res: 16.18; 19.24; 20.00; 21.60
Sup: 15.00; 13.31; 10.22; 6.52