WTI rises above $42 on US stimulus expectations

WTI prints gains on renewed hopes for additional US stimulus.
China's factory deflation eased in July, adding to bullish pressure around oil.

Omkar Godbole FXStreet Contributor

The American benchmark for the sweet light crude gained ground during Tuesday’s Asian trading hours in hopes for additional US coronavirus stimulus and signs of recovery in China, the world’s second-largest economy.

At press time, a barrel of West Texas Intermediate (WTI) is trading near $42.15, representing 0.5% gain. Prices rose by nearly 1% on Monday.

The black gold picked up a bid after President Trump tweeted Monday that top congressional Democrats wanted to meet him for discussing virus-related economic relief. The talks between Democrats and the Trump administration broke down last week, according to Reuters.

And yet hopes for additional stimulus may not be the only reason for the uptick in oil. Additional bullish pressure looks to be stemming from comments made by Saudi Aramco on Sunday that oil demand is rebounding in Asia with the gradual reopening of economies.

In addition, oil markets seem to be cheering the upbeat China producer price index (PPI) released on Monday, which showed factory deflation eased for the second month in July.

Gains, however, could be capped by lingering US-China tensions. As per the latest reports, China has unveiled a slew of policies to help boost the domestic semiconductor industry. The move comes after the US’ latest sanctions on Huawei exposed China’s reliance on external chipmakers.

Technical levels

WTI

Overview
Today last price	42.15
Today Daily Change	0.20
Today Daily Change %	0.47
Today daily open	42.15

Trends
Daily SMA20	41.33
Daily SMA50	39.94
Daily SMA100	32.98
Daily SMA200	43.23

Levels
Previous Daily High	42.48
Previous Daily Low	41.42
Previous Weekly High	43.62
Previous Weekly Low	39.75
Previous Monthly High	42.52
Previous Monthly Low	38.73
Daily Fibonacci 38.2%	42.08
Daily Fibonacci 61.8%	41.83
Daily Pivot Point S1	41.56
Daily Pivot Point S2	40.96
Daily Pivot Point S3	40.5
Daily Pivot Point R1	42.61
Daily Pivot Point R2	43.08
Daily Pivot Point R3	43.67

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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