WTI: Corrective mode intact around $ 59, focus on trade

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  • US-China trade truce uncertainty, pre-OPEC meeting jitters remain a drag.
  • US-Iran geopolitical worries, fresh USD selling and US inventory draw keep losses limited.
  • Eyes on US GDP data and fresh trade headlines for fresh directives.

WTI (futures on Nymex) managed to find fresh buyers once again near the 58.80 region, sending the rate back into the familiar range just ahead of the 59 handle, as markets stay focussed on the US-China trade developments heading into the G20 Summit, starting tomorrow.

The black gold is seen consolidating the corrective move lower from five-month tops of $ 59.91 reached in the US last session after the US weekly crude stockpiles data published by the Energy Information Administration (EIA) showed a bigger-than-expected drop in the US crude commercial stockpiles.

The bears remain in charge so far this Thursday, as a sense of caution prevails ahead of the Trump-Xi trade meeting at the G20. It’s widely expected that the US-China may not reach a trade deal this weekend. Further, markets also remain wary about a trade war cease-fire following mixed reports of a tentative trade truce reached.

Also, in focus remains the key OPEC+ meeting due next week, with investors unwilling to take any directional bets amid uncertainty whether the OPEC + will agree on extending the oil output cuts until December.

However, the buyers continue to lurk at the lower levels amid a fresh bout of selling seen around the US dollar across its main competitors while ongoing US-Iran geopolitical tensions continue to pose a risk to the global supplies, keeping the sentiment somewhat buoyed.

Looking ahead, the risk trends and USD dynamics will continue to influence the barrel of WTI while the US-China trade-related headlines will continue to remain the main market driver.

WTI Technical Levels

 

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