A steady push higher for WTI closing at $57.23 per barrel on the back of conflicting market sentiment and API data. On one hand, optimism around a successful phase one deal completion that would be in both US and China's interest have pushed prices higher as it would potentially increase the demand growth outlook. On the other, the latest data released from the American Petroleum Institute showed that US crude supplies rose by 4.3 million barrels for the week ended Nov.1, hence limiting further upside. Investors await EIA crude oil inventories out of the US today which we expect to miss estimates keeping pressure on the demand side.
Both our targets were hit on WTI in yesterday’s session, with price testing the 200 SMA on the daily chart and closing at $57.23. Our previous resistance level at $56.70 is now used as a support, with prices likely to test S2 at $56.22 upon the failure of S1 to hold. While a breach of the $57.2 resistance level backed by positive data of decreasing inventories will push prices higher in an attempt to test $58.19 resistance level.
Support: 56.70/ 56.22/ 55.85
Resistance: 57.21/ 58.19