- Crude oil clawing back losses seen over February.
- WTI, Brent gaining but still susceptible to oversupply.
Crude oil is staging a comeback following positive inflation figures from the US yesterday, with WTI lifting to 61.35/barrel from a low of 58.05 just four days ago.
WTI Crude has slumped recently, falling from a January peak of 66.60, but commodities firmed up following better-than-expected US CPI data, with month-over-month figures for January showing an increase of 0.5% for the single month, versus the anticipated 0.3%. Risk aversion took a backseat on the news, sending the US Dollar tanking further and causing oil to pare back a third of the losses sustained in February.
Brent has followed WTI's lead, scaling back up the charts on renewed market confidence, trading just shy of 65.00/barrel after recovering from a low of 61.80. Crude oil may have found the bidders yesterday, but American oil output still remains at record highs and inventories are still piling up; it won't take much to bring the 'liquid asset' tumbling down again.
Crude Oil Technicals
WTI and Brent have both accelerated severely, climbing for almost fourteen hours straight since US CPI data dropped, and exhaustion may become a factor, with a possible pullback to support at 60.55 for WTI and 64.00 for Brent. WTI will almost certainly run into resistance at 63.00, while Brent bulls will catch some friction heading into 66.50 if buying continues. If markets sour and crude resumes dropping, a break below the recent support area of 58.50 on WTI will see crude falling unchallenged unti lthe next swing support zone at 55.00.
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