- WTI Crude Oil prices extend the upward trajectory and climb to a fresh YTD peak on Wednesday.
- The technical setup favours bullish traders and supports prospects for a further appreciating move.
- The RSI on the daily chart is already flashing overbought conditions and warrants some caution.
Western Texas Intermediate (WTI) Crude Oil prices prolong a three-week-old uptrend and touch a fresh 10-month peak, around the $89.00 mark during the early part of the European session on Wednesday.
The Organization of Petroleum Exporting Countries (OPEC), in its monthly report released on Tuesday, said that Oil markets will tighten further this year amid robust demand and lower production. This comes on top of deeper supply cuts announced by Saudi Arabia and Russia – the world's two biggest Oil producers – for the remainder of 2023 and continues to benefit the black liquid.
From a technical perspective, the overnight strong move-up confirmed a breakout through the top end of a multi-day-old trading range and supports prospects for a further near-term appreciating move. That said, the Relative Strength Index (RSI) on the daily chart is already flashing overbought conditions. This, in turn, warrants some caution before placing fresh bullish bets around the commodity.
Hence, it will be prudent to wait for some near-term consolidation or a modest pullback before the next leg up. Any meaningful corrective decline, meanwhile, is likely to attract fresh buyers near the $88.00 mark. This should help limit the downside for WTI Crude Oil prices near the aforementioned trading range resistance breakpoint, now turned support, around the $87.55-$87.45 region.
The next relevant support is pegged near the $87.00 round figure, which if broken decisively has the potential to drag the black liquid towards the $86.30-$86.20 intermediate support en route to the $86.00 mark. The downfall could get extended further towards the next relevant support near the $85.60-$85.50 area, which should act as a strong near-term base for WTI Crude Oil prices.
On the flip side, a sustained strength above the $89.00 level should pave the way for a move beyond the $89.30-$89.35 zone, towards reclaiming the $90.00 psychological mark. Some follow-through buying will set the stage for additional gains and allow Crude Oil prices to climb further towards the $91.00 round figure en route to the $91.70-$91.80 supply zone and the $92.00 mark.
WTI Crude Oil daily chart
Technical levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD stands tall just below its highest level since January touched on Wednesday
The AUD/USD pair holds above the 0.6700 mark during the Asian session on Thursday. The Australian Dollar continues to draw support from the upbeat domestic Retail Sales data released on Wednesday, which strengthened the case for a rate hike by the Reserve Bank of Australia.
EUR/USD lurches higher after US data dumps Greenback
EUR/USD found a leg up on Wednesday, climbing briefly above the 1.0800 handle after a broad miss in US economic figures hinted at further signs of a weakening US economy, sparking fresh hopes for an accelerated pace of rate cuts from the Federal Reserve and markets flowing out of the safe haven US Dollar.
Gold reaches $2,360 on broad USD weakness
Gold gathers bullish momentum and trades at its highest level in nearly two weeks above $2,360. Following the disappointing ADP Employment Change and ISM Services PMI data from the US, the 10-year US yield declines sharply, helping XAU/USD extend its daily rally.
PolitiFi meme coins surge as Biden support lowers
Several political meme coins related to Vice President Kamala Harris rallied on Wednesday as prediction market odds favor her as the preferred Democrat nominee in the upcoming US presidential race.
Could the post-UK elections market moves resemble 1997 and 2010?
Thursday's UK elections expected to bring political change. Similar developments in both 1997 and 2010 weighed on the Pound. History points to a significant easing in Pound volatility across the board. Recent FTSE 100 performance matches the 2015 pre-election moves.