WTI crude oil recovered majority of its early losses to mid-$49.00s and remains within striking distance of seven-week highs touched in the previous session.
With the markets now looking past a couple of bullish monthly oil market reports, possibilities of some profit-taking seems be one of the factor behind the black gold's early retracement on the last trading day of the week.
It is worth reporting that oil prices have risen in excess of 6.0% from the $47.00 neighborhood, touched at the beginning of this week. Tuesday's OPEC report, showing production in August fell to 32.76 million, and IEA's upward revision of global oil demand growth in 2017 have been supportive of the commodity's up-move over the past few trading session.
However, growing market conviction that the demand and the supply imbalance in oil markets would continue to narrow in the coming months helped limit deeper losses, at least for the time being as investors now look forward to the latest weekly US rig count data, due later during the NY trading session for some fresh impetus.
Technical levels to watch
Immediate support is pegged near $49.60-50 area, below which the commodity could drift towards testing $49.00 mark and $48.80 support level.
On the upside, momentum back above $50.00 psychological mark, leading to a subsequent break through $50.30-35 hurdle, could pave way for continuation of the upward trajectory towards the $51.00 handle.
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