WTI bulls approach $80 as focus shifts away from China to US.

• WTI bulls are approaching $80 again.
• This week the focus will once again be on the US economy.

West Texas Intermediate (WTI) it has erased previous declines and is rising for the fifth day in a row, approaching $80. It has reached the highest closing price in the futures markets in three weeks. Despite sentiment of a somewhat lesser rebound in the Chinese economy, black gold is back in the hands of the bulls late in the day on Wall Street.

In the National People’s Congress, China settled for a growth target of 5% in 2023. It falls at the lower end of expectations and suggests that China will not apply large stimulus this year, but instead has an eye on the sustainability of the long term growth.

Meanwhile, CTAs will remain buyers of WTI crude as long as prices can stay above $73.00, which has served as the bottom of the recent technical range, TD Securities analysts said recently, adding:

Looking ahead, while excessive refinery maintenance is likely to contribute to rising oil inventories, it is also keeping commodity markets seasonally adjusted, offering some level of market support. In this sense, if the Russian offer begins to adjust, at a time when the market is more optimistic about the prospects of reopening of Chinese demand, the oil markets could prepare for a significant regime of short positions on the horizon. “.

Meanwhile, the key data for the week will be the US labor market on Friday, with US Non-Farm Payrolls. Analysts at Danske Bank expect growth to moderate to 220,000 jobs after the effects of the coronavirus wear off. warm weather and the strong seasonal adjustments of January. “Overall, leading indicators suggest labor market conditions have remained tight amid recovering growth prospects.”

These data will be released after testimony from Fed Chairman Powell, in which he could articulate hawkish sentiment and step back amid more cautious policy when raising interest rates. ”Recent strength in non-farm payrolls and retail sales support that policy is not tight and that the Fed may have been wrong for a soft patch in fourth-quarter data,” analysts at ANZ Bank noted.