Today in the early Asian session, WTI crude oil prices were flashing green and rose to $52.60, mainly due to the optimism surrounding the coronavirus as the cases dropped for the second day in China and concerns increased regarding the supply after a US move to cut more Venezuelan crude from the market.
The latest news came that China continues to struggle to restore manufacturing in the world’s second largest economy again after imposing substantial travel restrictions and city lockdowns to control the virus that has killed more than 2,000 people so far. However, investors still seem confident that the economic impact may be temporary.
Official data showed that new cases in China declined for a second straight day, although the World Health Organization has cautioned there is not enough data to know if the epidemic was being controlled.
Whereas, the prices have also been supported by expectations that the Organization of the Petroleum Exporting Countries (OPEC) and its allies will increase supply cuts.
The grouping, known as OPEC+, has been keeping supply under control to support prices and meets next month to decide a response to the downturn in demand resulting from the coronavirus epidemic.
Daily Support and Resistance
Pivot Point 51.98
On the technical front, WTI crude oil prices have violated the ascending triangle pattern on the lower side to trade at 51.45 level. The breakout patterns open further room for selling until 50.50 and 49.45. While the MACD has recently started forming histograms below zero level, which are suggesting odds of more selling in WTI crude oil prices. In case WTI crude oil violates 52.30 resistance mark, we may see crude oil prices heading towards 53.50. Good luck!