The price of oil was bleeding during the US session in a technical breakout spurred on by a Tweet from Trump telling OPEC to “relax” on prices. The tweet was meaningful enough to wipe out gains made earlier in the day on reports that US output is now hitting records of 12 million barrels per day. Prices had initially been making good progress on the upside, riding the sentiment of progress in trade talks between the US and China which took prices to multi-month highs. However, President Donald Trump called on OPEC to further prevent rising prices, saying in a Tweet, “Oil prices are getting too high. OPEC, please relax and take it easy. World cannot take a price hike - fragile!”
As expected, Crude prices plunged after hitting multi-months highs to retreat towards the $55.25 support level. The price is currently holding just above it but a breakthrough towards the downside seems to be more probable as the momentum is in a bearish mode. The next level we will be focusing on is the $54.42 support level.
Support: 55.25 / 54.42
Resistance: 55.73 / 56.69