Crude oil prices pushed higher this morning in a move which saw front-month WTI trade above resistance around $58. Crude rallied sharply yesterday, effectively reversing its selloff on Tuesday. In both cases, prices found support at $56 and resistance at $58. Could today’s break above $58 signal a bigger upside move for crude? It’s certainly possible.
Source: TN Trader
There are plenty of short sellers out there anticipating sharply lower future prices. And they may be forced to cover by buying back their shorts should momentum build to the upside. But as things stand, it’s too early to say that today’s break is significantly large enough and will prove protracted enough to trigger a bigger rally. Much will depend on tonight’s close and any follow-through on Sunday.
Today’s rebound follows heightened geopolitical risk, including renewed US threats toward Iran and continued efforts by the Trump administration to exert control over Venezuela’s energy sector.
Markets are also factoring in the potential impact of new sanctions targeting buyers of Russian oil, alongside expectations that commodity index rebalancing could bring fresh inflows into crude. Despite the recent rally, sentiment remains cautious, with expectations for a sizable surplus of crude oil later in the year continuing to hang over the market.
