WTI oil price holds with narrow and choppy range on Monday but remains above thin daily cloud after l rally from $64.43 (16 Aug low) showed signs of fatigue. Bullish sentiment on fears of further output reduction from Iran, due to US sanctions, is supported by strengthening bullish momentum and daily MA’s in firm bullish setup. On the other side, slow stochastic reversed from overbought territory after completion of bearish divergence, weighing on near-term action, along with increased number of US oil rigs. Initial signals of pullback require break below cloud base ($69.46) and 55SMA ($69.15), with extension below converged 100/10SMA’s ($68.74), needed to confirm scenario. Consolidation above daily cloud would keep bullish stance intact for renewed attempt above former high at $70.42 (30 July) and acceleration towards next pivot at $71.17 (Fibo 61.8% $75.34/$64.43).
Res: 70.48, 71.17, 71.64, 72.00
Sup: 69.45, 69.15, 68.74, 68.06
