Oil surges to 31-month high on hopes for strong rise in demand
Oil prices surged on Tuesday, inflated by expectations for growing fuel demand during the summer driving season in the US, continuation of slow increase in supply by OPEC+ group and strong Chinese factory data that support hopes for further rise in global oil demand.
WTI contract was up 2.5% since opening in Asia and rose to the highest since Oct 2018 at $68.84.
Fresh bulls came ticks ahead of $69 round figure barrier and turned focus towards psychological $70 level, with firmly bullish studies on all larger timeframes being supportive, however overbought conditions may produce headwinds and pause bulls for price adjustment.
Close above former2021 high at $67.95 would generate a bullish signal, but attack at $70 target could be delayed.
Shallow correction is expected due to improved sentiment, with dips to be ideally contained at $67.00/$66.50 zone and provide better levels to re-enter bullish market.
Only dip through $66 handle would put bulls on hold for deeper correction.
Res: 68.84; 69.00; 70.00; 70.36
Sup: 67.95; 67.10; 66.50; 66.05