Oil struggling near lows, bulls hopeful on Middle East supply cuts

A bullish bounce in oil is looking weak, but all buying will be welcome for stricken crude investors.
OPEC set to begin pursuing rising barrel prices once again with 1.4 million bpd production cut in December.

Joshua Gibson FXStreet

Crude prices are catching some minor lift from recent bottoms, with WTI peeling itself off of 54.75, and currently testing near the 56.00 region as oil traders test higher turf on the idea that Middle East suppliers could be going ahead with production constraints in the near future.

Oil's recent sell-off, sparked largely by the US' last-minute decision to provide oil-purchasing waivers from their Iran-targeted sanctions that came back into effect in early November, and the key crude access concession has seen oil barrels in free-fall, spurring concerned announcements from OPEC that the crude oil cartel will be considering significant supply cuts from their meeting in December, which has helped to halt the decline for the time being.

OPEC's announcement came not a moment too soon after crude barrels declined for twelve straight tradings days, and WTI saw its largest single-day contraction in over three years, and OPEC's formal announcement of slashing production by up to 1.4 million barrels per day far exceeds the cartel's initial whispers of 500,000 bpd.

WTI Technical Levels

WTI

Overview:
    Last Price: 55.95
    Daily change: 7.0 pips
    Daily change: 0.125%
    Daily Open: 55.88
Trends:
    Daily SMA20: 63.01
    Daily SMA50: 68.5
    Daily SMA100: 68.37
    Daily SMA200: 68.35
Levels:
    Daily High: 56.06
    Daily Low: 55.81
    Weekly High: 63.05
    Weekly Low: 59.24
    Monthly High: 76.25
    Monthly Low: 64.86
    Daily Fibonacci 38.2%: 55.91
    Daily Fibonacci 61.8%: 55.96
    Daily Pivot Point S1: 55.77
    Daily Pivot Point S2: 55.67
    Daily Pivot Point S3: 55.52
    Daily Pivot Point R1: 56.02
    Daily Pivot Point R2: 56.17
    Daily Pivot Point R3: 56.27

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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