Oil price ticks higher but remains in the middle of three-week congestion
WTI oil price stands at the front foot on Thursday as sentiment improved and positive impact from OPEC production cut and sanctions on Venezuela and Iran offset negative effect from record US oil output and unexpected strong rise in crude inventories after EIA report showed surprise build of 7 mln bls vs expected increase of 1.2 mln bls and previous week’s drav of 8.6 mln bls.
However, current price action remains near the mid-point of larger $55.01/$57.85 range as both, technical and fundamental signals are mixed and lack clearer direction signal.
Double-Dojis on Tue/Wed, one with long upper shadow and the other with long tail, confirm directionless mode.
Today’s brief advance cracked 10SMA barrier ($56.38), with close above needed for initial bullish signal, which would require confirmation on extension above Tuesday’s high ($57.17) to expose the upper boundary of the range.
Conversely, failure to clear 10SMA would weaken near-term tone, with extension below 20SMA ($55.70) to generate negative signal and unmask range floor ($55.01) reinforced by rising 30SMA.
Break of either side on near-term congestion would provide fresh direction signal.
Res: 57.17; 57.40; 57.85; 58.34
Sup: 56.08; 55.70; 55.55; 55.01