WTI oil extends rally on Tuesday, following previous day’s 2.95% advance and trades above $54 barrier for the first time in almost one year.
Fresh bulls attempt to clearly break key 200WMA barrier ($53.24) which capped the action in past three weeks (shaped in three consecutive tight weekly Dojis).
Firm break of 200WMA would signal continuation of larger recovery from April’s record low, with break of $54.62 (Feb 20 2020 high) to add to positive signals and push the price to pre-pandemic levels.
Fresh strength was fueled by signs that major crude producers keep the output cut in line with their commitments that offsets negative impact on fears of slowdown in demand recovery.
Bullish daily studies support the advance, which needs confirmation on weekly close above 200WMA, which now reverted to strong support and expected to hold dips and keep fresh bulls in play.
Traders focus on today’s API crude stocks report and Wednesday’s EIA report which could provide more signals, as last week’s unexpectedly strong draws in oil inventories boosted the sentiment.
Res: 54.62, 55.00, 55.43, 55.79
Sup: 54.00, 53.54, 53.24, 52.80
