- WTI probes one week high marked on Wednesday.
- Risk-on mood favor commodity prices via US dollar weakness.
- US election updates, FOMC become the key catalysts to follow.
With the latest pullback from $39.12, WTI bulls keep $40.00, currently around $39.35, on their radars during the early Thursday morning in Asia. The oil benchmark rose to the highest since October 27 the previous day as increasing odds of a Democratic candidate Joe Biden’s victory in the US elections favor risks and weigh on the US dollar.
Having won Michigan, Biden now has around 253 numbers in his pocket, per CNN, versus the required 270 counts. Fox News recently forecasted 264 seats for the Democrat versus 214 electoral votes for the current US President Donald Trump.
However, President Trump is trying, by all means, to give a tough fight to the rivals. The American leader recently called for a lawsuit against voting count in Wisconsin while also restricting the results in Pennsylvania, the key state, till Friday.
As the Democratic Party is comparatively more market favorite, due to its stimulus-friendly nature, the US dollar bears the burden of the risk-on sentiment. With this, commodities and equities benefit but the Treasury yields are yet to please the bulls as odds of a blue wave have recently diminished.
Other than the risks, official inventory data from the Energy Information Administration (EIA) also favor the black gold. In its latest update, EIA said, Crude Oil Stocks Change in the US was -8 million barrels in the week ending October 30th versus a prior increase of 0.9 million barrels.
Moving on, global markets remain prone to the US election updates while the Federal Open Market Committee (FOMC) meeting can offer intermediate moves amid a lack of oil-specific signals.
Technical analysis
Not only the confluence of 50-day and 100-day EMA, near $39.50, but the $40.00 psychological magnet and the 200-day EMA around $41.00 also challenge the WTI bulls.
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