WTI: Losing sight of 2015 highs ahead of US data?
- USD rebound weighs.
- Rising US output offsets a drop in crude inventories.
- US rigs count and NFP data in the spotlight.
WTI (oil futures on NYMEX) is seen moving further away from fresh multi-year highs reached above the $ 62 mark a day before, with the bears targeting the $ 61 mark ahead of the key US macro news.
WTI drops on profit-taking
The barrel of WTI drops nearly 1% to trade below $ 61.50, as markets resort to profit-taking ahead of the US rigs count and NFP data amid fresh concerns that the 10% rally seen last month is overdone.
Moreover, persistent increase in the US oil production levels continues to negate the optimistic generated from a drawdown in the crude stockpiles, as reflected by the EIA data. The US commercial crude inventories fell by 7.4 million barrels in the week to Dec. 29, to 424.46 million barrels, the EIA report showed.
The black gold rallied to the highest levels since May 2015 on Tuesday, as the sentiment was buoyed by rising geopolitical tensions in the OPEC’s No. 2 oil producer Iran. Also, bullish API crude inventories report and strengthening heating oil demand in the US added extra legs to the rally.
At the time of writing, WTI drops -0.90% to $ 61.42 while Brent trades -0.84% weaker at $ 67.52.
WTI Technical Levels
The resistances are aligned at $62.20 (2-1/2 year tops) ahead of $62.58 (May 2015 high) and $63 (round figure). On the downside, supports are located at $61.14 (5-DMA), $60.42 (10-DMA) and $60.00 (key psychological support).