WTI OIL consolidates within daily cloud; eyes crude inventories data for fresh signals
WTI oil is holding within tight range on Tuesday, extending consolidation above new five-week low at $58.06, posted after steep fall last week.
The price remains within daily cloud following Monday’s recovery attempt which spiked to $60.81 (rally was capped by 55SMA), but subsequent fall signaled strong upside rejection, leaving daily candle with very long upper shadow.
Limited prospect for stronger recovery could be expected while the price stays in the cloud, as daily techs are firmly bearish and building bearish momentum. In addition, overall sentiment remains negative on rising concerns about growing US oil production which has already dented efforts by OPEC-led bloc to tighten oil market by reducing global output.
Negative near-term outlook could be expected while recovery is limited and signaling extended consolidation before fresh weakness.
Initial upper pivots lay at $59.63/60.00 (daily cloud top / Fibo 23.6% of $66.28/$58.06 fall), followed by 55SMA / Monday’s spike high at $60.81 and Fibo 38.2% of $66.28/$58.06 at $61.20, break of which would generate stronger bullish signal.
Session low at $58.93 marks initial support ahead of Monday’s low at $58.06 and lower pivots at $57.69/62 9daily cloud base / 100SMA) loss of which will be bearish.
Res: 60.91; 61.20; 62.07; 62.35
Sup: 58.93; 58.06; 57.69; 56.80