WTI oil price is holding near new highest since September 2014 in early European trading on Monday, following Friday’s 4.3% advance the biggest one-day rally since Aug 23).
Rising geopolitical tensions on possible military conflict over Ukraine, continue to lift oil prices as war would disrupt already tight oil market, after OPEC and its allies announced the struggle to increase output despite strong demands for a monthly production increase by 400,000 barrels per day.
In such scenario, oil prices would easily rise through psychological $100 barrier and focus targets at $107.45 and $110.00.
Technical studies support the action, mainly driven by fundamentals, with loss of bullish momentum on daily chart and overbought conditions on weekly chart, suggesting bulls may take a breather.
Dips are expected to be shallow on overheated situation, with price action to remain highly volatile and sensitive to updates regarding the situation over Ukraine.
Rising 10DMA ($90.68) should ideally contain and guard pivotal supports at $88.30 (last week’s higher base, reinforced by rising 20DMA), loss of which would signal deeper pullback.
Res: 94.90; 96.08; 97.89; 99.59.
Sup: 92.41; 91.68; 90.68; 90.00.
