- WTI price is looking to retest the weekly highs above $ 72.
- Omicron’s low-lethality optimism and Chinese stimulus support oil.
The WTI barrel price (NYMEX futures) is trading modestly on Wednesday, seeking to extend the recent rally amid reduced fears over the negative impacts of the new variant of COVID Omicron on global economic growth.
Also, a drop in weekly crude oil reserves announced by the American Petroleum Institute (API) also supports sentiment around oil. However, the main driver continues to be the escalation of geopolitical tensions between the United States and Russia over the issue of the invasion of Ukraine, which serves to extend the rally due to optimism in equity markets.
US oil is flirting with daily highs near $ 72.10, up 0.85% on the day.
Meanwhile, the technical setup on the WTI day chart shows that price has room to climb towards the powerful resistance zone around $ 74, where the 21-day bearish moving average and the horizontal 100-day moving average converge. The Relative Strength Index (RSI) is pointing to the upside, but remains below the midline, suggesting that downside risks still persist.
A rejection from a higher level could generate some weakness and head for a retest at the daily lows at $ 71.11, below which the support of the $ 70.00 200-day SMA follows.
Alternatively, immediate resistance is seen at Tuesday’s high of $ 72.81. The next relevant positive target to the upside is set at the $ 74 level.
WTI day chart
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