With the USD carrying its NFP-backed strength forward, coupled with fresh doubts on US-China trade deal, WTI remains on a back foot around $57.70 during today’s early session. The greenback surged across the board on Friday after the US headline employment data, non-farm payroll, beating most optimistic forecasts and turned down the expectations of a 50 basis points rate cuts from the US Federal Reserve in its upcoming meet. Adding to the downside could be the latest doubts on the US-China trade truce raised by China’s SCMP news report. The Chinese daily mentioned to ignore the hype about the US President Donald Trump and his Chinese counterpart Xi Jinping being closer to a trade deal. However, geopolitical tension between the US and Iran, coupled with global supply reduction from the Organization of the Petroleum Exporting Countries and its allies, offer strong downside support to the black gold.
Crude prices rebounded during late Friday’s session after receiving some support from the bulls printing higher lows from the previous sessions. The price is currently fighting the $57.81 resistance level with an increasing momentum as shown by the RSI indicator. We will therefore focus on the upside before we expect another drawdown. Should oil prices break above the current key important resistance level, the $58.8 resistance level will be the next level to watch.
Support: 57.4 / 56.69
Resistance: 57.81/ 58.21