WTI probes $30.00 following latest recovery moves, eyes on API

Having dropped the previous day, WTI holds onto recovery gains for the fourth time in preceding five days, currently up 3.1% on NYMEX Futures to 29.85, ahead of the European session on Tuesday.

The black gold earlier dropped amid growing concerns of supply glut amid Russia-Saudi Arabia rift that postponed the OPEC+ meeting from  Monday to Thursday.

The energy benchmark’s recent strength could have taken clues from US President Donald Trump’s comments that nobody asked him for the US production cuts and he will decide afterward if asked. Also suggesting the move by the US oil producers were Mr. Trump’s comments that the free market will curb output ‘automatically’, as per Bloomberg.

Further, the market’s positive risk-tone, mainly due to receding coronavirus (COVID-19) figures, as well as signals of further stimulus from the US, Japan and New Zealand might also have pleased the commodity traders.

While portraying the risk-tone, the US Treasury yields and Asian stocks remain mostly positive by the press time.

Oil traders may now wait for the private weekly inventory data from the American Petroleum Institute (API), prior 10.485M, for fresh direction. Though, this week’s meeting by the OPEC+ group will be the key to follow. It should be noted that Russia and Saudi Arabia have signaled further cuts in the output whereas the US was the latest entry to the list.

Technical analysis

21-day SMA near $27.75, Friday’s high near $29.00 and $30.00 round-figure offer nearby resistance to the oil benchmark while sellers may look for entry below 10-day SMA level of $24.95.