- WTI prices jump to test bear’s commitments at daily resistance.
- OPEC+ stick to output cut levels as India seen as a temporary risk.
Despite India’s coronavirus surge and a subsequent decision from OPEC+ to stick to raising output, the price of WTI has rallied on Tuesday to score fresh 4-hour highs.
WTI has travelled from a low of $61.94 to a high of $63.27 on the day so far ahead of the latest weekly US oil inventory reports which analysts expect will show a rise in crude stocks. I
The industry data from the American Petroleum Institute is due at 4:30 p.m. EDT (2030 GMT), followed by the government’s report on Wednesday.
Meanwhile, traders continue to bet on a strong recovery from the US, European and Chinese damnd which is fuelling the bid today as the market brushes aside the OPEC+ announcement that it will stick to plans to raise output slightly from May 1.
In other words, traders are buying the fact and the rationale is that OPEC+ likely does not see a lasting impact on demand from India’s coronavirus crisis otherwise it would do more.
OPEC+ has also scrapped plans to hold a full ministerial meeting on Wednesday.
WTI technical analysis
As per the prior W-formation on the daily chart above, there is the scope of a downside test of the current W-formation’s neckline.
However, there is the probability of an upside extension first as illustrated on the chart of the current resistance gives-out which guards a run to the 64 area and prior highs.