WTI firmer, $ 60.50 tested amid N. Korea-led risk-on

• N. Korea news boosted risk-appetite, driving the oil-price recovery.
• Focus shifts to the US rigs count data for fresh direction.

WTI (oil futures on NYMEX) appears to have entered a phase of consolidation, after the Asian recovery ran out legs at the $ 60.50 resistance, as the bulls take a breather ahead of the US drilling activity report due later in the NA session.  

The steady recovery staged by the black gold was mainly driven by an improvement in the sentiment towards the higher-yielding/ risk assets after North Korea offered to suspend its missile tests program and the North’s leader would like to meet the US President Trump.

Responding to Kim Jong-Un’s invitation, the White House said Trump would accept the invitation at a place and time to be determined, which is seen as a truce between both the countries that lifted the Asian equity markets.

From a wider perspective, the barrel of WTI remains exposed to downside risks amid soaring US output levels. The US is expected to surge past 11 million bpd by late 2018, replacing Russia as the world’s top oil producer.

WTI Technicals

At $ 60.36, the supports are located at $ 60 (psychological levels), $ 59.50 (classic S2/ Fib S3) and $ 59.10 (Feb 12 low). On the flipside, the resistances are aligned at $ 60.63 (100-DMA), $ 61.39 (5-DMA) and $ 62 (20-DMA).