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  • spot WTI is currently trading at $58.87bbls within a  range of between $58.63bbls and $59.55bbls.
  • Oil prices dented on a drop in investor sentiment as mixed trade headlines take a hold.

There were reports that China has revoked on trade offers while Dow Jones sources said that US / China is progressing towards final stages and  China’s Vice  Premiere  Liu is visiting Washington soon while  Mnuchin will be flying to Beijing week of March 25th.

Besides the knee jerk dip in sentiment, oil prices had been met with resistance in a key technical area having made fresh highs at $59.55 on a spot basis.

“Energy markets continue to nudge higher with risk assets, as OPEC’s strong commitment towards market rebalancing has continued to provide a constructive narrative from the supply-side. Ultimately, Saudi Arabia’s  oil  policy,  centered  around economics, was successful in seeing prices retrace half of the December carnage correction.

Price levels are unlikely to be sustained in the long-term

Looking forward, however, these price levels are unlikely to be sustained in the long-term, as investment levels have started to creep higher and could significantly jump higher in a firm price environment. OPEC+ will likely manage its production cuts as it seeks to keep the market in balance and reduce incentives from nonconventional producers to grow output too much. That being said, we see little flow in the cards from CTAs just yet,” analysts at TD Securities explained.  

WTI levels:

“While bulls are on track for a potential run higher, subsequent to a break of the descending trend line resistance at current levels, bulls will need to break out of the rising wedge formation’s resistance just below the 62 handle at 61.86. However, the Ichimoku Cloud will likely remain bullish, so long as the price subsequently holds above the 59 handle on a rejection at wedge resistance on first attempt, leaving the outlook positive for an eventual run to 61.8% fibo target.”

  • WTI Technical Analysis: Bulls meet trendline resistance, but rising wedge resistance could cap extensions ahead of 61.8% Fibo