- WTI fades the rebound on $38 level amid risk-off mood.
- Rising coronavirus cases and US election jitters spook markets.
- Eyes on US election outcome, NFP and rigs count data.
WTI (futures on NYMEX) has stalled the sharp rebound near the midpoint of the 38 level, as sellers continue to lurk amid a risk-off market profile.
The demand for higher-yielding assets such as oil is almost absent, as markets remain on the edge, awaiting the outcome of the nail-biting US election.
The latest recovery in the black gold lost legs after the European markets slipped into the red zone amid coronavirus and election concerns induced risk-aversion.
The risk-on flows pick up pace in Europe amid increased odds of a sweeping ‘Blue Wave’ win in the US election, which will pave the way for a larger fiscal stimulus package. The upbeat market mood powered the higher-yielding oil at the expense of the safe-haven US dollar.
The US oil extends its corrective declines from six-day highs into the second straight day on Friday, as concerns over the oil demand outlook continue to hurt the sentiment amid new lockdowns in the UK and Europe to contain the virus contagion.
The WTI barrel shrugged-off some optimism following the plunge in the US crude stockpiles. The Energy Information Administration (EIA) weekly US crude supplies report showed Wednesday that the commercial crude stockpiles fell by 8 million barrels in the week to Oct. 30.
Markets now look forward to the US election outcome, NFP and rigs count data for fresh direction on the prices.
WTI technical levels
“Considering the downbeat conditions of MACD histogram, coupled with the sustained reversal from the key EMAs, oil sellers are likely targeting the October 02 low of $36.79 during the further declines. However, the $38.00 threshold can offer intermediate support whereas September’s bottom surrounding $36.40 acts as an extra downside filter,” FXStreet’s Analyst Anil Panchal explained.
WTI additional levels
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