WTI Oil holds firm tone on Tuesday and extends recovery from correction lows at $49.09/12 (Fri/Mon lows), to test psychological $50.00 barrier.
Monday’s close above 200SMA was bullish signal for further upside, with fundamentals also being supportive, as OPEC said on Monday that there is clear evidence the market is rebalancing after few years of oversupply which depressed oil prices.
Close above $50 will be another positive signal with extension above $50.52 (Fibo 38.2% of $52.84/$49.09 pullback / converged 10/20SMA’s) to generate initial reversal signal.
Near-term action is holding in thick hourly cloud and eyeing cloud top at $50.15, with cloud base at $49.64, offering solid support and expected to ideally contain dips.
Only return below 200SMA ($49.42) would generate bearish signal and risk retest of recent lows at $49.12/09, reinforced by 55SMA.
Res: 50.06; 50.52; 50.80; 50.97
Sup: 49.64; 49.42; 49.09; 48.35
