Renewed China optimism keeps oil price afloat but the downside remains at risk
The WTI oil remains slightly bullishly aligned on Friday morning, following bounce on Thursday.
Oil price regained traction after a sharp fall this week, as fresh signals on renewed hopes that China’s demand may rise and lower US inventories improved sentiment, though more evidence is still needed to signal reversal.
Fresh support may also emerge from profit-taking, after sharp fall on Tue/Wed, with oversold daily studies supporting the notion.
Fresh recovery is still facing headwinds at initial Fibo resistance at $74.57 (23.6% of $81.49/$72.44) and keeping away pivotal barrier at $75.89 (Fibo 38.2%), break of which is needed to firm the structure and signal further retracement of $81.46/$/$72.44. bear-leg.
On the other hand, dollar has received fresh support from surprise US data on Thursday, with better than expected US NFP numbers today, to add to support and increase pressure on oil price.
The WTI contract is on track for a weekly fall of over 8% that signals increased downside risk, as weekly studies are overall bearish.
Res: 74.57; 75.89; 76.17; 77.12
Sup: 72.77; 72.44; 70.23; 70.00