WTI oil price hit new 2019 high at $56.63 on Monday, in extension of last week’s strong rally, when WTI contract advanced nearly 7%.
Renewed optimism over US/China trade talks, added to positive oil price sentiment on OPEC production cut and sanctions on Iran and Venezuela that tightened oil markets.
Weekly close above pivotal $55.55 barrier (Fibo 38.2% of $76.88/$42.36) was strong bullish signal.
Fresh extension higher approaches next target at $57.09 (100SMA) violation of which would spark further advance, however, bulls may show hesitation as stochastic is strongly overbought and momentum turned lower.
Consolidative action should ideally hold above broken pivots at $55.73/55 (previous high of 4 Feb/Fibo 38.2%), but deeper dips cannot be ruled out.
Rising 5SMA marks support at $54.89, with deeper pullback expected to find ground above lower pivots at $53.97/77 (converged rising 10/20SMA’s).
Res: 56.63, 57.09, 58.14, 59.62
Sup: 56.09, 55.55, 54.89, 53.97
