WTI CAPPING UP FRESH HIGH

With just four trading sessions left before the WTI June contract expires, in despite the total number of coronavirus cases reaching 4.5 million and 300k death reported worldwide by Johns Hopkins and the market, in general, ignoring the US unemployment claims close to 3 million, the oil price was able to capped to a fresh high. A whole trading week has cost the market to shatter its consolidation and finally break the $26 handle.

Market impulse can be attributed to the additional 1mb/d pledge cut from Saudi Arabia on Monday to take effect next month in the aim to support the stability of global oil markets, where concerns remain about the easing of the lockdowns leading to a second wave of COVID-19 cases that could profoundly impact the already crippled demand.

Moving on to the technical side, the chart indicates a clear bullish bias after the breakout of the flag formation in the D1 chart. Price action is currently trading above the 50EMA, fighting the resistance from previous high on April 3rd at 28.63 handle, with sufficient room for price action to manage and reach next golden Fibonacci level 6.18 where the bullish momentum in MACD and the RSI still far from the overbought level support the bias. However, we could expect a small correction and price re-testing the upper line from the flag as long as price action is not able to break the current level.\

This week probably close inarguably bullish, where the OPEC+ altogether with non-OPEC producers and their 6.6mb/d cuts response informed on the IEA’s monthly report has given the marker the need support for this roaring come back.