Oil is up by 1.6% on the day
Rising again above the $50 psychological stage is essential for bulls to construct some momentum however that is merely the place to begin. Trying on the day by day chart, worth is now already working into day by day resistance from the 23.6 retracement stage @ $50.51.
For oil bulls, the turning level for my part can be a break above the December excessive @ 54.55 and holding a break above the $55 deal with. If worth is ready to transfer in direction of that and search for a break above the 38.2 retracement stage @ $55.55, then we might begin to see an actual turnaround in oil sentiment.
Because it stands, oil is likely one of the greater beneficiaries from improved danger sentiment to start out the week. US-China commerce talks are seemingly making respectable progress and the greenback stays on the weaker aspect following Powell’s dovish remarks final Friday.
After an virtually 45% drop in just below two months, oil bears are beginning to really feel the pinch now of stretched brief positioning. Essentially, aside from an enchancment in danger sentiment, not a lot else has modified for oil. Nevertheless, nobody factor ever strikes in a straight line and with any sharp drop there’s all the time the ache of place masking.
I reckon so long as danger sentiment holds up, it will nonetheless gas some added brief masking and a transfer to the upside. However as talked about above, until the $55 stage breaks, any actual extension stays considerably restricted.