Oil Erase Early Gains to $46.00, Turns Negative but Holds $44.00
WTI crude oil
futures once again are seeing selling pressure at higher levels, near
$45.90-$46.00/barrel mark, forcing the commodity to erase all of its
early gains to currently trade at low point of the day $44.20.
During the Asian session on Monday, the black gold saw a bullish opening and gained momentum towards $46.00 mark on concerns over supply disruption in response to the raging Canadian wildfires. Market also cheered on news that Saudi Arabia ousted oil minister Naimi and appointed Aramco’s Khalid al-Falih, who is known to undertake reforms, in a bid to stabilize oil markets.
As the day progressed, the commodity erased all of its early gains and turned negative but is till holding its neck above $44.00/barrel mark. Traders will now look forward to this week's crude stockpiles report, for fresh insights on oil fundamentals and in order to determine the next direction move for crude oil prices.
Technical levels to watch
On a sustained weakness below $44.00 mark, the commodity could be eyeing last week's swing lows support near $43.30-20 area, which if broken should open room for a further corrective move towards $42.55-50 important support.
Meanwhile a move above $44.50 might now confront resistance near $45.00-10 area, which is followed by a strong resistance near $45.95-$46.00 area. Only a sustained break through $46.00 strong resistance would negate any bearish bias, thus lifting the commodity beyond 2016 highs resistance near $46.75 level, to reclaim $47.00/barrel mark and head towards its next major resistance near $47.50-60 area (Nov. 2015 highs).