Oil Turns Positive, Inching Closer to $50.00 Mark
After an initial pull-back to $49.42, WTI crude oil prices regained buying interest at session low level and lifted the commodity back above multi-month high daily closing level of $49.70.
On Monday, the black gold rose on reports of more attacks by militants to Nigeria's oil operations. Of late, oil prices have been moving sideways and have stagnated below $50.00/mark barrel.
Investors now await for fresh impetus from the weekly API report on crude inventory, slated for release later during NY session. Investors will also look forward to the Chinese release of its May crude import data ahead of official EIA report on US stockpiles on Wednesday.
Meanwhile, broader weakness seen in the greenback also seems to support higher crude oil prices. In the meantime, traders might turn cautious as a sharp turn-around for the US Dollar would make it costlier to hold dollar-denominated commodities like oil.
Technical levels to watch
On the immediate upside, $50.00 psychological mark remains key resistance to watch for, which if conquered would pave way for further appreciating move for the commodity towards Oct. 2015 highs resistance near $51.35-40 area.
On the flip side, weakness below $49.00, and a subsequent drop below $48.75-70 support, is likely to drag the commodity back towards $48.00 handle, below which the near-term corrective move could get extended towards a previous resistance, now turned strong support near $47.00 level with intermediate support near $47.40 area.