WTI on the bids around 3-week top amid geopolitical tensions
- Latest UN report adds into the prevailing play of geopolitics between the US and the Middle East.
- Buyers may aim for 200-D EMA during further upside.
- The US oil rig count data from the Baker Hughes could offer fresh impulse while politics likely offering background music.
With the recent UN report adding Saudi Arabia into the US and Iran dominated geopolitical tussles, WTI is taking the bids near $57.35 during early Friday.
While previous news reports of the US adding 1,000 troops to its Middle East forces and Iran gunning down the former’s drone were already challenging oil supplies, the latest report from the UN blaming Saudi Arabia for the death of the US reporter Jamal Khashoggi indicates renewed tension between the US and Saudi Arabia.
As per the UN report, that the death of journalist, Jamal Khashoggi, was ‘an international crime’, citing ‘credible evidence’ that Saudi crown prince Mohammed bin Salman could be liable for the killing.
While there was no immediate response from the US President Donald Trump to the report, the Republican-dominated Senate voted down the $8.1 billion deal of the US arms sales to Saudi Arabia and other Arab allies.
The US turned abruptly silent after the reporter’s death, might be to avoid chances of breaking ties with global oil leader.
On the other hand, Iran’s envoy to the United Nations (UN) mentioned that the US unmanned aircraft was spotted in their airspace and the nation will act to safeguard its interest if the US disturbs it.
Although political plays surrounding geopolitics could keep directing the black gold’s moves, Baker Hughes Oil Rig Count for the current week could offer additional details to predict near-term oil sentiment. The rig count previously dropped to 788.
Technical Analysis
FXStreet Analysis, Ross J Burland, says that WTI bulls can aim for $60 as far as prices are above the 50-day exponential moving average (50-D EMA):
The price of oil climbed through the 20-D Experiential Moving Average, (EMA), and the 50-D EMA, now en route for the 200-D EMA. Bulls now aim for a break there with eyes set on the 30th May highs of $59.67 which comes just below $60 psychological level. Meanwhile, if the bulls hold out, bears will look back towards the 200 weekly EMA and the 61.8% Fibo. Thereafter, the 14th Jan 50.41 low and then the 26th November lows at 49.44 will be in sight.
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.
