WTI Price Analysis: WTI to close a 2% winning week, bullish momentum wanes

On Friday, the West Texas Intermediate (WTI) advanced near $88.00 and settled below $87.00, still poised for a 2% weekly gain. That said, the daily chart continues to show overbought conditions, suggesting that a downward technical correction may be on the horizon.

On the upside, Saudi Arabia and Russia will extend voluntary supply cuts for the rest of the year and boosted Oil prices during the week. Moreover, the demand from the world's biggest consumer, the US, remains resilient, as shown in the last set of data, which could also favour the price.

Additionally, China and the Euro area report soft economic data and lower demand will limit WTI’s upside. In addition, a stronger USD, whose DXY rose to multi-month highs this week on the back of hawkish bets on the Federal Reserve (Fed), will also present challenges to the black gold’s upside in the next sessions. Lastly, Rising oil output from Iran and Venezuela may add selling pressure.

 
WTI Levels to watch 

 Based on the daily chart, the WTI shows indications of bullish exhaustion, leading to a neutral to bullish technical outlook. The Relative Strength Index (RSI) is firmly in overbought territory with a positive slope above its midline, suggesting a potential retracement to consolidate gains while the Moving Average Convergence (MACD) shows stagnant green bars. Furthermore, the pair is above the 20,100,200-day Simple Moving Average (SMA), suggesting that buyers are firmly in command of the larger time frame.

 Support levels: $87.00, $85.00, $83.50. 

 Resistance levels: $88.00, $89.80, $91.00.

WTI Daily Chart