WTI futures are surging with strong momentum towards a fresh more than 13-year high near 115.00. The price recorded two consecutive impressive bullish days, sending the technical indicators into overbought regions. The RSI is holding above its 70 level, while the MACD is strengthening its movement above its trigger and zero lines, both suggesting that the strong upward move may soon come to an end.
If the price retreats and creates a bearish correction, immediate support levels could come from the 112.00 inside swing high from August 2013 ahead of the 107.45 barrier, taken from the peaks in June 2014. Steeper declines may send the market beneath the 100.00 round number, testing the 20-day simple moving average (SMA) at 93.15.
However, in case traders continue to buy oil, the next crucial resistance may come from the 261.8% Fibonacci of the down leg from 85.35 to 62.27 at 122.85. More aggressive advances could open the way for an extension until the 147.00 top, registered in July 2008.
To conclude, WTI futures have been in an impressive rally over the last few days and only a return below the 100.00 may switch the outlook to a negative correction.
