- WTI struggles to close the bearish opening gap.
- A firm breakout above the 21-hour SMA is critical for the bulls.
- US oil remains vulnerable amid demand and election concerns.
WTI (NYMEX futures) is attempting a tepid recovery from the five-month lows of $ 33.85 reached early in the Asian session on Monday, as the bulls have been rescued by China’s bullish Caixin Manufacturing PMI and a rally. on Japanese export orders.
Despite the rebound, risks remain skewed to the downside for black gold as coronavirus fears deepen, with the UK and major European economies under further lockdowns, fueling concerns over oil demand .
Meanwhile, investors are heading toward the safe-haven US dollar ahead of Tuesday’s election, putting additional downward pressure on dollar-denominated oil prices.
Oil bulls are trying to close the opening bearish gap, with prices hovering around $ 35, unable to make a sustained recovery above the downtrend 21-hour moving average at $ 35.20.
Acceptance above this level could expose the bearish 50 hour SMA at $ 35.83. Buyers need a daily close above $ 35.90 to maintain the recovery momentum.
On the other hand, the five-month lows of $ 33.85 could be put at risk if sentiment on Wall Street turns sour, though that seems unlikely for now given the 1.15% rally in S&P 500 futures at this time.
WTI 1 hour chart
Credits: Forex Street
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