WTI oil was steady on Thursday and probed above $50 handle after five-day fall found footstep at $49.76 on Wednesday.
Oil prices were supported by larger than expected fall in crude inventories which fell by 6 million barrels last week, EIA report showed on Wednesday.
Oil was also boosted by comments from Russian President Putin who said that OPEC and other main oil producers outside the cartel pledge to extend existing production cut deal to the end of 2018, as the deal expires in March 2018.
Fresh boost to the oil price gives a breather to near-term bears that made a $3 fall in past five days.
The pullback from $52.84 is seen as correction of larger $45.57/$52.84 rally and was so far contained by $50 zone, which is seen as ideal reversal point.
Daily techs remain bullish overall and support scenario of fresh upside, along with deeply oversold slow stochastic.
However, recovery needs to clear important barriers, to generate firmer bullish signals and shift bias higher.
Initial barrier lies at $50.26, provided by 20SMA and base of thick hourly cloud, which so far capped today’s recovery action.
Close above here would open way towards hourly cloud top at $50.75 and next pivot at $51.08 (10SMA) and confirm reversal on sustained break higher.
Res: 50.26, 50.75, 51.08, 51.70
Sup: 49.76, 49.48, 49.20, 48.90
