The situation for crude Oil has improved since December, as US WTI put a bottom in place above $70, following a bearish momentum since June last year. Although, uncertainty still remains as Oil continues to trade in a range, with a top at around $82-83, which has rejected buyers twice.

Although, last week we saw some decent buying again, which went against the broader market sentiment, which was negative, as risk trades including stock markets and commodity dollars were declining, while the USD continued to gain. On Thursday the price slipped lower, but buyers returned on Friday and the 50 SMA (yellow) was broken on the daily chart.

Oil Daily Chart – The 50 SMA Has Been Broken

The 100 SMA is next

we saw that the stochastic indicator was still going up and there was room to run higher, and now the next target for Oil buyers is the 100 SMA (green) which comes at around $81.50s, while above that we have the top of the range. The bullish move on Friday came after Russia decided to cut Oil production by 500K bpd in March, which sent prices higher by more than 2%. This came after Europe implemented a ban on Russian Oil products earlier this month.

Novak said in a statement that “As of today, we are fully selling the entire volume of oil produced, however, as stated earlier, we will not sell oil to those who directly or indirectly adhere to the principles of the price cap”. “In this regard, Russia will voluntarily reduce production by 500,000 barrels per day in March. This will contribute to the restoration of market relations.”

US WTI Crude Oil Live Chart