This is an important week for Oil as an OPEC meeting followed by US inventory reports should determine the market sentiment. From a fundamental perspective, oil should find support amidst the attempts to stabilize prices with OPEC production cuts in plan. However, Russia’s reluctance to cooperate with OPEC’s proposal in addition to the unsettled US-China trade war factor into increasing pressure on global demand thus undermining the impact of output reduction.
Oil moves within a tight range and struggles to extend its scattered gains over the last week. Short-term moving average crossovers confirm the short term uptrend channel that oil is on, as it climbs above the 10MA. However certainty over a bullish sentiment should emerge if price surpasses the resistance at 58.83 where the 50-period moving average lies. Tightening of the bands indicates a ranging phase that will be confirmed should price break out of the channel and fall to the 20MA at 56.50
Support: 56.60 / 55.92
Resistance: 58.01 / 58.90