A partial cease-fire between Saudi Arabia and Yemen continues to see the geopolitical risk premium priced out and WTI crude fall from a high of $56.75 to a low of $54.79 during Friday’s session. WTI closed down 3.8% for the week, weighed down by the very rapid recovery in Saudi crude production. At the same time, the US is considering limits in investor portfolio flows into China, pressuring prices taking into consideration that rising trade tensions between China and the US would hurt energy prices.
As expected, Crude oil prices fell from a high of $56.75 per barrel to a low of $54.79 before quickly recovering back towards the 56 level. The price is currently hovering around the $55.92 support level however we can easily notice a divergence between the price and the momentum and this time it is pointing towards an upward move. We will be focusing on the $57.40 resistance level in the next 48 hours.
Support: 55.06/ 54.42
Resistance: 55.92/ 56.27