Oil Trading Below $44.00 ahead of US Jobs Data
WTI crude oil
edged lower on Friday as focus shifts back to fear of oversupply,
shrugging-off worries of supply disruptions in Canada and Libya.
Currently, oil is trading with a cut of 1.5% at $43.65 and over 5% from $46.04 high touched on Thursday. Oil is now headed to end the week with a cut of over 4%.
Firm US Dollar, ahead of the US payrolls releases, also seems to be weighing on crude oil prices. Markets are expecting a healthy reading of over 200,000 new jobs addition during the month of April, which might now fuel speculation of a Fed rate-hike in June. Higher interest rates a currency dearer and tends to weigh on commodity prices that are priced in dollars.
Crude oil prices are reversing from an important resistance at $46.00 level, nearing recent daily closing high levels. This marks a shift in investor sentiment and might continue to weigh on oil prices in the near-term.
Technical levels to watch
On the immediate downside, Wednesday's low of $43.20 might extend some immediate support, which if broken opens room for a further downfall towards $42.40-35 support and eventually towards 200-day SMA important support near $41.75.
On the upside, move above $44.00 handle should confront resistance at day's peak near $44.50 level. A follow through buying interest should assist the commodity to rally back towards $45.00/barrel mark and resume its previous upward trajectory back towards $45.95-$46.00 strong resistance.