WTI reaches seven-year highs above $78.00 on OPEC+ agreement

Earlier in the European session, oil prices were range-bound within $75.31 and $76.00. However, an announcement by the Organization of Petroleum Exporting Countries and its allies (OPEC+) leave the crude oil increase by 400K by November, spurring WTI’s rally to a seven-year high, because the market was expecting a larger increase. WTI is trading at $78.01, recording a 3.20% gain at the time of writing.

The market sentiment is downbeat, with major US stocks losing between 1.16% and 2.42%, hammered by rising energy prices, inflationary pressures, and higher US bond yields. Meanwhile, the US Dollar Index (DXY), which usually follows the US 10-year Treasury yields path, is down 0.30%, sitting at 93.78, against a basket of six rivals.

WTI Price Forecast: Technical outlook

WTI’s $3 spike to a seven-year high left the $77.00 threshold as new support. The daily moving averages (DMA’s) remain well below the price, supporting the upside bias.
For buyers to sustain the rally, they would need a daily close above the latter. In case of that outcome, the first resistance would be $78.00. A breach of that level would expose crucial supply levels, the October 4 high at $78.20, followed by $80.00.

On the other hand, failure at $77.00 could pave the way for further downward pressure. The first demand zone would be the September 28 high at $76.65. A decisive push beneath that level, WTI’s following support levels would be the September 30 high at $76.04, followed by $75.00.

The Relative Strength Index (RSI) is in oversold levels at 71, with an upward slope, suggesting that upside pressure stills in place. However, RSI above 70 indicates that consolidation or a correction is nearby.

KEY ADDITIONAL LEVELS TO WATCH