Oil Erases Early Losses, Touches $46.00 Level

Oil Erases Early Losses, Touches $46.00 Level

2 May 2016, 14:26
Roberto Jacobs
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Oil Erases Early Losses, Touches $46.00 Level

WTI crude oil futures erased all of its early losses to move back towards $46.00 mark. The commodity is currently trading near $45.95, with some marginal gain from its Friday's close of $45.92.

On Friday, crude oil gave up its gains from $46.75 to close absolutely flat from Thursday's level. On Monday prices dropped back to Friday's low but broad USD weakness continues to extend support at lower levels, helping prices to recover early losses to trade absolutely flat.

During the US session, investors would try and seek direction from a key gauge of US manufacturing sector, ISM manufacturing PMI

Technical levels to watch

Daily RSI reading just above 70.00 mark is indicating that the near-term up-move might be entering overbought territory and could face technical hurdle at higher levels.

However, a move back above $46.00 handle would increase the prospects of retesting Friday's high resistance near $46.75 and a clear break-through $46.75 resistance level would set the stage for a further up-move towards Nov. 2015 daily closing high level resistance near $47.50-60 area.

Meanwhile on the downside, weakness below Friday's low support near $45.50-40 area could drag the commodity back towards $45.00 psychological mark support. Only a convincing break below $45.00 would now be considered as the onset of near-term corrective move for the commodity.


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