Brent Oil: Pullback from 4-month highs stalls at 50-hour MA support
|- Brent oil retreated from four-month highs seen yesterday, possibly on fading trade optimism.
- The repeated defense of the 50-hour MA, as seen in the last few hours, could fuel a re-test of highs above $68.00 hit yesterday.
Brent oil is currently trading at $67.58 per barrel, having defended the 50-hour moving average (MA) support, currently at $67.44, over the last 12 hours.
Prices clocked a four-month high of $68.18 yesterday after the American Petroleum Institute reported a surprise draw in crude oil inventory of 2.133 million barrels for the week ending March 15. The break above $68.00, also fueled by OPEC's decision to extend supply cuts to June, was short-lived, possibly due to fading trade optimism.
Bloomberg reported yesterday that Trump administration is worried China may be reneging on certain trade concessions. The report also said that Chinese negotiators are worried that the US may not remove sanctions even after the deal is struck.
As a result, the risk sentiment soured with Dow Jones Industrial Average falling 26 points. The bid tone around oil also weakened, allowing a fall back to the 50-hour MA support.
However, the highs seen yesterday could again come into play, as trade talks between the US and Chinese teams are set to resume next week, according to an administration official.
Technical Levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.