US oil is consolidating under Monday’s fresh recovery high at $49.64 but holds strong bullish sentiment which was boosted by agreement for extended output cut. Tuesday’s price action is holding above broken Kijun-sen line at $48.74 (also 50% of $53.74/$43.74 descend) above which the price managed to close on Monday after rally lost traction and stalled at $49.64, failing to sustain break above 200SMA at $49.34. Kijun-sen line offers strong support and immediate focus will remain shifted higher while the price is holding above it. However, today’s price action is ranging between daily Kijun-sen and 200SMA ($48.74/$49.38) and extended consolidation could be expected while these boundaries hold. Also, slow stochastic is strongly overbought on daily chart and is turning lower that may generate negative signal for fresh easing. Break below $48.74 pivot would expose support at $48.25 (Fibo 23.6% of $43.74/$49.64) and $47.73 (Monday’s low) and would delay final push through $50.00 target.
Res: 49.38, 49.64, 50.00, 50.39
Sup: 48.74, 48.36, 48.25, 47.73
