WTI Price Analysis: WTI rises and threatens the 200-day SMA at the end of the week

On Friday, the West Texas Intermediate (WTI) rose more than 1% near $76.80 and is set to close a 1.89% weekly gain. On the upside, prospects of a Chinese stimulus to bolster the economy supports the price, while a slight recovery of the USD may limit the upside potential.

After the People Bank of China (PBoC) decided to hold its key rates steady, Bloomberg reported that Chinese policy makers are up to ease mortgage rates to bolster homebuying in the second-largest economy in the world due to recent economic downturns. In that sense, lower rates in the most prominent Oil importer of the world favour the price as a less aggressive monetary policy may strengthen the economy.

On the other hand, the American calendar won’t have anything relevant to offer, and traders continue to assess the latest set of inflation, retail sales, the housing market and jobless claims data from the US. For next week’s decision, markets are mainly discounting a 25 basis point (bps) hike, but the odds of a second week past July have dropped nearly 35%. In addition, markets will closely watch Jerome Powell’s presser to look for clues regarding forward guidance.

WTI Levels to watch

The bulls managed to get a final chance to retake the 200-day Simple Moving Average (SMA). If they fail, the price could plunge as buying momentum displays weakness as per the indicators on the daily chart. Meanwhile, the Relative Strength Index (RSI) stand with a slight positive slope above its midline, while the Moving Average Convergence Divergence (MACD) prints lower green bars.

Resistance levels: $76.82 (200-day SMA), $78.00,$80.00.
Support levels: $73.50 (100-day SMA), $72.90 (20-day SMA), $72.00.

WTI Daily chart