Following its failure to settle above the 58 level, WTI witnesses a pullback during today’s early morning session. Optimism surrounding the US economy, mainly basis on Friday’s upbeat employment report, failed to last long as media releases from the US and China continue to tame the odds favoring a trade deal between the world’s two largest economies. The latest red signals include China’s top official’s warning of destruction to the US if it considers the dragon nation an enemy and the US Commerce Departments announcement to collect extra reserves from importers of Chinese and Mexican structural steel. However, geopolitical tension between the US and Iran, coupled with oil production cut extension by the Organization of the Petroleum Exporting Countries and its allies, limited the black gold’s downpour.
Crude prices surged above the $58 level reaching a high of $58.44 per barrel but failed to settle above as it retreated back towards the $57.4 support level. The price is currently receiving a strong support from the 57.40 level and the momentum is slowly building towards the upside. If the 57.4 support level will hold the prices above it, then a move to the upside will be most probable and we will be focusing on the 58.8 resistance level.
Support: 57.4 / 56.69
Resistance: 57.81/ 58.21