WTI oil extends rebound from seven-month low and hits three-week high on Thursday, after receiving fresh boost from signals that OPEC+ cartel is willing to cut production and significantly stronger than expected drop in the US crude inventories that added to persisting supply concerns.
Saudi Arabia’s energy minister said that production cut will support prices, with Iran exports still being halted due to nuclear program talks, adding to the sentiment, though analysts think that even Iran’s return to the market would have limited impact, as oil market will remain tight, following cut of Russian supply on sanctions.
Recovery tests key barrier at $95.61 (200DMA) and faces strong headwinds here, signaled by overbought stochastic and fading bullish momentum on daily chart.
If recovery stalls here that would signal that correction is likely over and keep larger bears intact for fresh push lower, with return below $90 to confirm the action.
Violation of 200DMA, on the other hand, would further weaken larger bearish structure and open way for stronger correction, with lift above $100 (psychological / Fibo 38.2% of $123.65/$85.35) to add to bullish signals.
Res: 95.61; 96.54; 97.45; 99.58.
Sup: 94.39; 93.31; 91.34; 90.75.
