With last weekend’s risk-on carrying forward, WTI rises to $55 level during today’s early session. The energy benchmark recently took advantage of the US President Donald Trump’s comments and expectations of further easing from China’s central bank while portraying the aftershocks of OPEC’s latest report. In its monthly Oil Market Report, the Organization of the Petroleum Exporting Countries cuts forecast for 2019 global oil demand growth to 1.10 million barrels per day versus the previous forecast of 1.14 million bpd. In addition to announcing only a marginal impact of likely global slowdown, the oil cartel upwardly revised 2020 demand. Recently, the US President Donald Trump turned down expectations of an economic recession while news took the rounds that the People’s Bank of China is to release a new reference rate for bank loans and should see lower rates for business borrowings. Additionally, the Forbes report of a weekend attack over the Saudi Aramco’s oil facility at Shaybah adds strength to the momentum. Weighing to the upside is also the on-going pessimism surrounding the US-China trade deal that recently worsened after the US President challenged China’s Hong Kong moves and termed Huawei as the national threat.
Crude oil prices picked up momentum this morning as they move above the $55 resistance level after being under bearish pressure during Friday’s session. The price is currently trading just below the $55.5 level as the RSI shows a build up in the momentum. Our main focus will be to the upside as the $56.27 resistance level will be on our watch.
Support: 55.06/ 54.42
Resistance: 55.92/ 56.27