WTI oil extends bounce from $50.60 base on Wednesday, maintaining bullish near-term tone.
Strong fall in oil inventories (API report on Tuesday showed draw of 10.1 mln bls vs previous week’s 5.3 mln bls build), cut in oil exports from Libya and already announced decision of OPEC and other main oil producers to cu the output, boosted oil prices.
Fresh bulls closed above 10SMA ($51.74, now reverted to solid support) on Tuesday, broke above 200WMA ($52.30) and cracked 20SMA ($52.85) on Wednesday’s extension higher.
Close above the latter would generate fresh bullish signal and improve the outlook for further recovery towards recent tops at $54.50 zone and falling 30SMA ($55.34).
North-heading momentum on daily chart supports scenario along with improving sentiment which could be further boosted if today’s EIA report shows stronger than expected fall in US crude stocks (2.9 mln bls draw f/c vs 7.3 mln bls draw last week).
Only return and close below $50.60 base would neutralize bulls and re-focus cracked psychological $50 support.
Res: 52.85, 53.49, 54.54, 55.34
Sup: 51.97, 51.25, 50.60, 50.00
