WTI extends rebound from a one-month-old support line towards 71.00, up 0.53% on a day around 70.70 by the press time of the pre-European session on Tuesday. The commodity’s recovery moves also gain support from bullish MACD signals aim at the rejection of last week’s bearish candlestick formation, by an upside clearance of 72.75. Following that, the monthly high near 72.90 and late July tops close to 73.90 will challenge the oil buyers. Meanwhile, a downside break of the stated support line, around 70.40, will have to get validation from the 70.00 threshold to recall the black gold bears. Rising gas and coal prices, due to the supply shortage, are gradually encouraging utilities to switch from gas and coal to fuel oil. Sweden has started up oil-fired power plants. Oil demand will get a fresh boost from the US’s announcement that the travel ban would be lifted for foreign travellers who are fully vaccinated from November. This could see jet fuel demand recovering strongly towards the end of this year.

BULLISH AND BEARISH CONDITIONS/ POSSIBILITIES :

WTI is trading well above the daily exponential moving averages, suggesting the uptrend is intact. The recent dip could suggest there is an ongoing bearish correction. The first support level would be 70.0. A daily close below the latter could pave the way for further losses. The next demand area would be the confluence of the 50 and the exponential moving average 100, around 69.35. A break below of that area would expose the September 9 low at 67.56. On the other hand, in the case of a daily close above 71.00, it could mean that WTI could resume its uptrend. The first supply zone on the way up would be $2.00. A decisive break of it could open the door for further gains. The following resistance would be the September 15 high at 73.11.

WTI

Sep 21 2021