WTI bulls approach $80.00 as cautious optimism underpins Oil’s first daily gain in four – Crypto News – Crypto News
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WTI bulls approach $80.00 as cautious optimism underpins Oil’s first daily gain in four – Crypto News

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  • WTI picks up bids to rebound from weekly low, snaps three-day downtrend.
  • US Dollar pullback, hopes of more demand from China supersede bearish EIA Oil inventories.
  • Fears of more Fed rate hikes, US SPR releases challenge energy bulls.

WTI crude oil snaps a three-day losing streak around $79.50, extending the previous day’s rebound from the weekly low, amid early Thursday’s sluggish markets. The black gold’s latest recovery could be linked to the market’s cautious optimism, as well as a pullback in the US Dollar from a multi-day high marked on Wednesday.

The improvement in the risk appetite could be linked to Chinese President Xi Jinping’s readiness to deepen industrial and investment cooperation with Asia. It’s worth noting that the International Energy Agency’s (IEA) latest report, published on Wednesday, also mentioned the IEA report.

On the other hand, a pullback in the US Treasury bond yields allowed the US Dollar bulls to take a breather at the multi-day high and help the commodities to lick their wounds. That said, the US 10-year Treasury bond yields retreated following the run-up to a 1.5-month high marked on Wednesday, down two basis points to near 3.78% by the press time, whereas the US Dollar Index (DXY) prints 0.15% intraday loss while easing to 103.70 at the latest, after rising to the 1.5-month high the previous day.

It should be observed that the strong US data weighed on the energy prices, via hawkish Fed bets, the previous day. Among the key data, US Retail Sales for January and the NY Empire State Manufacturing Index for February gained major attention. Following the data, the market’s bets on the Fed’s next moves, as per the FEDWATCH tool of Reuters, suggest the US central bank’s benchmark rate is to peak in July around 5.25% versus the December Federal Reserve predictions of 5.10% top rate.

Elsewhere, the official weekly oil inventory data from the Energy Information Administration (EIA) marked a notable increase in the stockpile for the week ended on February 10, to 16.283M versus 1.166M expected and 2.423M prior. The same should have favored the Oil bears but could not as the market slips into consolidation mode ahead of second-tier US data concerning the housing market, industrial activity and producer prices.

technical analysis

Despite the latest rebound, the WTI crude oil remains between the 50-day and 100-day Simple Moving Averages (SMAs), which in turn suggests a lack of conviction among traders. That said, the 50-DMA and the 100-DMA levels are at $77.90 and $80.90 at press time.

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