WTI extends recovery from three-week lows towards $74 mark
- WTI’s recovery remains at full steam amid risk rebound.
- Upbeat EIA stocks data also underpin the US oil.
- Covid concerns remain a risk, as the US dollar firms up.
WTI (futures on Nymex) is off the highs but remains strongly bid above $73.50, as it looks to extend its recovery from three-week lows of $70.76 well beyond the $74 mark.
The two-day recovery in the black gold comes on the heels of a bigger-than-expected draw in the US weekly crude inventories, as reported by the Energy Information Administration (EIA) on Thursday. The EIA said in its report, “US crude and gasoline stocks fell and gasoline demand reached its highest since 2019, signaling increasing strength in the economy.”
Meanwhile, the latest upside in the US oil can be linked to the recovery in the risk sentiment. European stocks see a relief rally, as bargain hunters jump in after witnessing one of the worst selloffs this year amid resurfacing concerns over slowing global economic recovery.
At the time of writing, the US oil is trading at $73.80, up 1.30% on the day, headed for the first weekly loss in seven.
However, it remains to be seen if the price can sustain the recovery amid the resurgent US dollar’s demand, courtesy of a rebound in the Treasury yields across the curve. Further, oil traders also look forward to the Wall Street sentiment and US rigs data for fresh trading incentives.
WTI technical levels to consider
Author
Dhwani Mehta
FXStreet
Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.
