WTI testing lows near $ 52.50, US GDP, rigs count eyed

• Eases-off half-yearly tops.

• Saudi Arabia’s Crown Prince comments underpin.
• US Q3 GDP – key.

WTI (oil futures on NYMEX) is on a gradual retreat from half-yearly tops reached at $ 52.86 in the overnight trades, now meeting fresh supply to test the midpoint of 52 handle.

WTI: Profit-taking ahead of US data?

The black gold is seen reversing a part of yesterday’s solid rally and turns negative in mid-Europe, as markets resort to profit-taking ahead of the key US Q3 GDP data and drilling activity report due later in the NA session.

Moreover, the USD bulls gather pace for the next push higher, leaving the USD index in a phase of consolidation near three-month tops, which also collaborates to the renewed weakness seen in the USD-sensitive oil.

Oil prices gained a day before, despite resurgent broad-based USD demand amid progress on tax reforms, as the comments from the Saudi Crown Prince, backing the case for OPEC oil cut deal extension into 2018, underpinned.  

Focus now remains on the US Q3 growth numbers, with a better print expected to add extra legs to the ongoing USD rally, which could extend the corrective move lower in oil. However, a drop in US rigs count could keep the downside limited.

At the time of writing, WTI drops -0.23% to $ 52.52, while Brent trades flat near $ 59.20 levels, having failed near $ 59.50 barrier.

WTI Technical Levels

Higher-side levels: 52.86 (6-month high), $53.21 (Apr 16 high), $ 54 (round number)

Lower-side levels: 52.06 (10-DMA), 51.50 (psychological levels), 51.15 (classic S3)