Oil Rises above $47.00 Mark to a Fresh 6-Month High

Oil Rises above $47.00 Mark to a Fresh 6-Month High

16 May 2016, 11:42
Roberto Jacobs
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Oil Rises above $47.00 Mark to a Fresh 6-Month High

WTI crude oil futures kicked-off the fresh trading week on a strong footing, moving back above $47.00/barrel mark for the first time since early November 2015 on bullish comments from a leading investment banker.

Last week's recovery in oil prices from $43.00 mark was led by unexpected fall in US crude oil inventories and by EIA's monthly Oil Market Report that expected a fall in output from non-OPEC producers while expecting the demand surprise on the upside on the back of growing gasoline consumption. Moreover, recent supply disruption from the likes of Canada, Libya and Nigeria suppressed worries over global supply glut.

The black gold also seems to benefit from mild USD weakness on Monday. Investors now turn their focus to the weekly inventories data to get some fresh insights on supply-demand dynamics.

Technical levels to watch

From technical perspective, the ongoing momentum seems strong enough to lift the commodity further towards Nov. 2015 daily closing highs resistance near $47.60 ahead of intraday highs resistance beyond $48.00 handle, near $48.25-35 region.

On the downside, upward trending 50-hourly SMA near $46.35, which is closely followed by $46.00 round figure mark seems to protect immediate downside. Any further weakness below $46.00 might be limited and is likely get bought into near $45.80 strong support.


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