Oil holding steady, WTI near $68.20

WTI lost some ground as markets turned around on Thursday, but managed to put in a floor early.
Crude is losing its support from Middle East tensions, but OPEC is still looking to cut back on the oversupply glut.

Joshua Gibson FXStreet

WTI crude oil is trading in place heading into Friday's action, testing 68.20.

Oil declined in the latter half of Thursday's trading as Middle East concerns begin to fade from recent memory. The recent ramp-up in the Syrian civil war propped up oil prices significantly, but the bolstering effect of tensions over American involvement in a missile strike on Syria's chemical weapons capabilities have fizzled with little action from the Russian side of the equation, who condemned the US' action in Syria and threatened retaliation. The event has slipped past without further incident and so has the Syrian crisis' effect on oil.

The only thing keeping oil supported right now is the OPEC's supply cuts, which seem to be slowly eating away at the massive oversupply being crammed into US supply chains by overproduction. Saudi Arabia recently announced they would be happy to see oil back at $80, or even $100, per barrel, but those targets remain a long way off as the US continues to slowly expand their production capabilities.

WTI Levels to watch

Crude oil is in a bit of a support/resistance vacuum at these levels, but is closing in on the lower end of the boundary, and as FXStreet's own Pablo Piovano noted recently, "the next resistance at $69.55 (2018 high Apr.19) followed by $69.66 (monthly high Dec.2014) and finally $70.00 (psychological level). On the downside, a break below $66.24 (10-day sma) seconded by $65.56 (low Apr.17) and then $65.28 (21-day sma)."

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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