WTI keeps recovery moves above $41.00 amid cautious optimism

  • WTI extends bounces off $39.51 to cut most of the losses marked the previous day.
  • Anticipated recoveries in Asia, the largest oil consumers, favor the bulls.
  • Consolidation in risk sentiment, hopes of soft Brexit, a deal on US stimulus join upbeat EIA inventories.
  • US dollar moves, risk headlines can play their roles amid a light calendar.

WTI stays above $41.00, currently near $41.20, before Tokyo opens for Friday’s trading. The energy benchmark dropped heavily the previous day before recovering from $39.51. While fears of the coronavirus (COVID-19) and a further delay in the US stimulus keep the oil bulls challenges, hopes of recovery in Asia, led by China, joined the slump in the weekly inventories to favor the recovery moves.

China leads the recovery moves…

Although Beijing couldn’t offer welcome inflation data in September, flashed on Thursday, the activity pick-up in the world’s second-largest economy continues. The same could be gauged from an increase in China’s crude oil imports that grew 17.6% YoY to 48.5 million tonnes in September. Not only the dragon but India and Japan are also likely to mark a notable increase in oil demands considering a comparatively less severe pandemic impact, for now, than the west.

Also on the positive side were the weekly inventory data, from the Energy Information Administration (EIA), which slipped below -2.835M forecast to -3.818M for the week ended on October 09. Earlier in the week, figures from the private data provider, the American Petroleum Institute (API), also marked a surprise draw in stockpiles worth -5.42M for the noted period.

Elsewhere, the recent signs concerning Brexit and the US stimulus have been positive. German Chancellor Merkel’s recent statement that the talks are constructive and intensive gives, coupled with no end to the Brexit negotiations on the expiry of October 15 deadline, keeps the market hopeful of a soft departure of the UK from the bloc. On the other hand, US House Speaker Nancy Pelosi ruled out the market forecast of no stimulus till January whereas Treasury Secretary Steve Mnuchin also said that if a deal between the two could be reached Trump would “weigh-in” with Senate Republican leader Mitch McConnell. 

As a result, S&P 500 Futures part ways from the previous day’s downbeat performance of Wall Street, up 0.28% intraday to 3,485.

Moving on, global oil traders will have to follow the macro headlines closely amid a light calendar. In doing so, the market’s inclination for the US dollar will also be the key to watch.

Technical analysis

Although the 100-day EMA level of $39.77 restricts the quote’s short-term downside, bulls are likely to remain cautious unless breaking a falling trend line from September 18, at $41.67 now.

Additional important levels

Today last price 41.25
Today Daily Change -0.13
Today Daily Change % -0.31%
Today daily open 41.38
Daily SMA20 40.06
Daily SMA50 40.83
Daily SMA100 40.18
Daily SMA200 39.04
Previous Daily High 41.41
Previous Daily Low 40.11
Previous Weekly High 41.68
Previous Weekly Low 37.13
Previous Monthly High 43.56
Previous Monthly Low 36.43
Daily Fibonacci 38.2% 40.91
Daily Fibonacci 61.8% 40.61
Daily Pivot Point S1 40.52
Daily Pivot Point S2 39.66
Daily Pivot Point S3 39.22
Daily Pivot Point R1 41.82
Daily Pivot Point R2 42.27
Daily Pivot Point R3 43.12



Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD bounces to stabilize around 1.1750

Fears keep ruling the financial boards as rising COVID-19 cases lead to fresh lockdowns across the Union, Germany included. Dollar correcting extreme overbought conditions.


GBP/USD falls below 1.30 amid fears of a UK lockdown, Brexit impasse

GBP/USD has dropped below 1.30 as the British government mulls a new lockdown to curb the spread of coronavirus. The pound is also pressured by the Brexit impasse.


XAU/USD hits fresh monthly lows near $1,870 and remains vulnerable

Gold is falling sharply and is down almost two percent, even after trimming losses. XAU/USD tumbled to $1,868/oz reaching the lowest level since late-September.

Gold News

Bank of Canada leaves policy rate unchanged at 0.25% as expected

In a widely expected decision, the Bank of Canada (BoC) announced on Wednesday that it left its key rate unchanged at 0.25% following its October policy meeting.

Read more

WTI bounces off lows near $37.00/bbl post-EIA

Prices of the WTI remain on the defensive albeit off lows. Demand concerns dragged prices to 3-week lows near $37.00. EIA reported an unexpected 4.3 mb build during last week.

Oil News