- The oil price has shown a stellar recovery after printing a fresh 15-month low at $65.88 and is aiming to stretch it further.
- US Biden’s denial of further sanctions on Russian oil and revised China’s GDP forecast have supported oil price.
- A bullish reversal has been pinned as the oil price has crossed the critical resistance of $69.00.
West Texas Intermediate (WTI), futures on NYMEX, is making efforts in sustaining its auction above the critical resistance of 68.50 in the early Asian session. The oil price has shown a stellar recovery after printing a fresh 15-month low at $65.88 and is aiming to stretch it further on expectations of a smaller interest rate hike by the Federal Reserve (Fed).
Despite soaring fears of banking turmoil, the oil price has shown a recovery due to the least appetite of the United States for levying more sanctions on oil supply from Russia. US President Joe Biden believes that Russia won’t deliver oil below the current $60/barrel, which could disturb the demand-supply equilibrium.
Also, a surprise upside in China’s Gross Domestic Product (GDP) forecasts has fueled a sense of optimism in the oil price. Goldman Sachs revised 2023 China’s GDP projections higher to 6% from 5.5% anticipated earlier.
WTI has shown a confident recovery after testing a fresh 15-month low at $65.88 on Thursday. The oil price has formed a Double Bottom chart pattern on an hourly scale, which indicates a bullish reversal as the asset re-tested its prior crucial lows with less selling pressure. A bullish reversal has been pinned as the oil price has crossed the critical resistance of $69.00.
The black gold is aiming to shift its auction above the 20-period Exponential Moving Average (EMA) at $68.50, which will underpin a short-term upside trend.
Meanwhile, the Relative Strength Index (RSI) (14) has delivered a range shift move from the bearish territory of 20.00-40.00 to the neutral region of 40.00-60.00, which cements a bullish reversal.
For further upside, the oil price needs to break Thursday’s high at $69.53, which will drive the asset toward the horizontal resistance plotted around $71.00. A break above the latter will further push the oil price to near February 22 low at $73.85.
On the contrary, a downside move below the 15-month low at $65.88 would drag the asset toward 30 November 2021 low at $64.40 followed by 02 December 2021 low at 62.41.
WTI hourly chart
-638146066394935632.png)
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to gains above 1.0750 after US data
EUR/USD manages to hold in positive territory above 1.0750 despite retreating from the fresh multi-week high it set above 1.0800 earlier in the day. The US Dollar struggles to find demand following the weaker-than-expected NFP data.
GBP/USD declines below 1.2550 following NFP-inspired upsurge
GBP/USD struggles to preserve its bullish momentum and trades below 1.2550 in the American session. Earlier in the day, the disappointing April jobs report from the US triggered a USD selloff and allowed the pair to reach multi-week highs above 1.2600.
Gold struggles to hold above $2,300 despite falling US yields
Gold stays on the back foot below $2,300 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.6% after weak US data but the improving risk mood doesn't allow XAU/USD to gain traction.
Bitcoin Weekly Forecast: Should you buy BTC here? Premium
Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.
Week ahead – BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.