WTI: Buyers attack $58.00 as US stimulus hopes back energy optimists, API in focus

WTI stays strong near January 2020 highs while extending recent bounce off $57.59.
Saudi Arabia’s extra supply cut from February gets active, chatters of eroding supply glut gain momentum.
American stimulus hopes, US dollar weakness add strength to the commodities.
API inventories, risk catalysts become the key catalysts to watch.

Anil Panchal FXStreet

WTI bulls dominate near $58.00, highest since January 2020, amid the initial Asian session on Tuesday. In doing so, the energy benchmark rises for the seventh consecutive day amid hopes of recovery in global energy demand as well as fears of the supply cut.

Considering Saudi Arabia’s earlier pledge to cut down on its output during February and March, the global oil supplies are likely to be limited during these months. As a result, the rumors over a reduction in the supply glut gains momentum.

On the other side, global vaccinations and pick-up in economic activities seem to have favored the energy demand.

Additionally, increasing odds of US President Joe Biden’s $1.9 trillion covid relief stimulus as well as the Tehran-Washington tussle over the 2015 nuclear accord also help the commodity.

It’s worth mentioning that the US dollar weakness adds cherry to the black gold’s run-up. That said, the US dollar index (DXY) eased from the two-month high and dropped for the second consecutive day on Monday.

Looking forward, private oil inventory data from the American Petroleum Institute (API), prior -4.261M, will be the key. Though, energy traders shouldn’t ignore updates from the US-Iran story and American stimulus for fresh impulse.

Technical analysis

Sellers are less likely to take entries until the quote stays above February 2020 peak surrounding $54.70.

Additional important levels

Overview
Today last price	58
Today Daily Change	1.13
Today Daily Change %	1.99%
Today daily open	56.87

Trends
Daily SMA20	53.33
Daily SMA50	49.95
Daily SMA100	45.19
Daily SMA200	41.71

Levels
Previous Daily High	57.17
Previous Daily Low	56.21
Previous Weekly High	57.17
Previous Weekly Low	51.6
Previous Monthly High	53.94
Previous Monthly Low	47.26
Daily Fibonacci 38.2%	56.8
Daily Fibonacci 61.8%	56.57
Daily Pivot Point S1	56.33
Daily Pivot Point S2	55.79
Daily Pivot Point S3	55.37
Daily Pivot Point R1	57.29
Daily Pivot Point R2	57.7
Daily Pivot Point R3	58.24

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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