WTI accumulates back to the 50-HMA as bulls step up the plate
- The bulls have stepped up to the mark again, although struggle to get back above the 50-HMA.
- Markets are now looking to OPEC+ with reaffirmed commitment from Russia.
The price of a barrel of oil has been sliding at the start of this week and West Texas Intermediate crude is currently down 1.41% having fallen from a high of $56.89 to a low of $55.55 so far, albeit with a firm rejection from the bulls and price forced back tot he 50-hour moving average.
WTI pulling back from one-month highs
The supply concern gains that sent the black gold to a one-month high last week following a large drop in US product inventories data. Markets are now looking to OPEC+ with reaffirmed commitment from Russia to deepen their production cuts in December, underpinning upside potential still for the market.
"Indeed, as expectations of large surpluses have dwindled somewhat, the recent surge in risk appetite and the circulation of bearish shale production outlooks has seen upward momentum firm and triggered CTA buying across the complex with both WTI and Brent crudes, along with gasoline and heating oil seeing upside CTA flow," analysts at TD Securities explained who view additional material upside as unlikely given demand fears and expected production growth outside of OPEC remain. Meanwhile, West Texas Intermediate crude for December delivery was losing 65 cents, or 1.2%, at $56.01 a barrel on the New York Mercantile Exchange.
WTI levels
The bulls have stepped up to the mark again, with the price now back to the 50-hour moving average as bulls defend the mid-point of the 55 handle. Bull will look back to the 57 handle and the 200-day moving average where it collides with a 38.2% Fibonacci retracement level. Meanwhile, below the said resistance, bears can look for a break below the 21-DMA around 53.70 ahead of the 50 handle which opens prospects for the Nov 2018 lows at 49.39 again. The 46.90 level ahead of the 18th Dec lows down at 45.77 will then be in focus.