WTI Oil eases below $50 handle after hitting fresh highs of over two months at $50.39/41 on Monday /today, failing to emerge above weekly cloud top on repeated attempt.
Oil price’s recent advance was supported by rising global demand and continuous drawdown in oil stocks, but rise in OPEC production in July, despite a deal among oil producers to cut output, marks strong headwind for oil prices.
Corrective easing was signaled by reversal of slow stochastic deeply in the overbought territory and turning near-term focus towards initial supports at $49.41/17 (broken 200SMA / Monday’s low), with deeper pullback on break of the latter supports not ruled out.
Extended dips would target next pivot at $48.48 (Fibo 38.2% of $45.39/$50.39) and $47.90 (daily Tenkan-sen) which is expected to contain.
Release of US API and EIA crude inventories reports is in focus as both inventory reports are expected to show further draw in oil stocks which would further boost oil prices.
Res: 50.42; 50.90; 51.98; 52.14
Sup: 49.73; 49.41; 49.17; 48.48
