WTI prices shot higher overnight on the back of good news on the trade front following Trump’s announcements that some of the expected tariff hikes will be put back to the end of the year. The September delivery on the New York Mercantile Exchange, added $2.17, or 4%, to settle at $57.10 a barrel for the best finish for a front-month contract since July 31. This has left a technically bullish bias on the charts.
We can see that the bulls were holding just above the 50% retracement of the late Dec to 2019 range. On overnight trade, the bulls subsequently took out the cluster of the 20, 50 and 200 daily moving averages to bust through both the 56 and 57 handles. There is now space for a recovery to the 58 handle to meet trend line resistance. On the downside, bears can target a break of the 50% reversion of the day’s move at 55.80.