The selling pressure surrounding crude oil eased a little on Thursday and allowed the barrel of West Texas Intermediate to erase a small portion of this week's losses. After dropping to its lowest level since early January at $50.50, the WTI rose toward the $53 handle but met resistance there. The data from China on Thursday showed that the trade surplus in July came in at $45.06 billion to beat the market expectation of $40 billion and eased concerns over a weak demand outlook. Additionally, the lack of fresh headlines surrounding the US-China trade conflict paved the way for crude oil to stage a technical correction. Similarly to Saudi Arabia, The UAE's energy minister Suhail al-Mazrouei said that they will support actions to balance the oil market and added that they were confident that their OPEC and non-OPEC partners will take similar measures, providing support to crude oil bounce.
Crude oil prices headed to its lower level during Wednesday’s session reaching the $50.50 support level after loosing momentum, but then took a U-turn during Thursday's early session and erased most of the losses after pulling away from the oversold zone. The price is currently is still trading just above the $52.5 support level and looks like the recovery is on its way to extend. We will be focusing on the $53.26 resistance level before we turn our attention to the downside again.
Support: 53.26/ 52.5
Resistance: 53.89/ 54.42