WTI oil extends recovery on Wednesday, as negative tone from President Trump’s warning to OPEC about high oil prices, fades.
Fresh extension higher retraced slightly over 61.8% of $57.79/$55.01 after strong fall on Monday (oil price was down 3%) found footstep at psychological $55.00 support.
OPEC remains committed to its production cut policy and market returned to bullish mode that was interrupted by $57.79/$55.01 corrective pullback.
The action was also supported by strong draw of US oil stocks (API report on Tuesday showed 4.2 mln bls draw vs previous week’s build of 1.2 mln bls). Rising bullish momentum and daily MA that returned to bullish configuration support and turn near-term focus towards new 2019 high at $57.79 (22 Feb) and upper 20-d Bollinger band at $58.10.
US EIA crude inventories report is in focus today (2.8 mln bls build f/c vs 3.6 mln bls build previous week) and could further boost oil prices on surprise release under expectations.
Broken rising 10SMA offers initial support at $56.31, with falling 100SMA ($55.82) required to hold and keep fresh bulls intact.
Res: 56.86; 57.13; 57.79; 58.45
Sup: 56.50; 56.31; 55.82; 55.55
