Oil and the 5th ascending week
For the energy market, especially for the Oil market, these days ahead with the OPEC+ meeting will be important. Last week, WTI closed a shy under $74 to print the 5th uptrend week in a row.
The oil market is getting boosted by different news. While IHS Markit report shows that at least six states in the United States face temporary fuel shortages as demand surges, air travels increasing to add the demands, at least in the summer. On the other hand, the US infrastructure package progress is another reason the Oil market is getting more boosted.
With increasing the market demand, OPEC and its allies in OPEC+ following the scheduled supply while US Baker Hughes Total Rig Count was unchanged last Friday evening at 470 rigs.
On the geopolitical front, Iran's nuclear talks with western powers are not going as well as expected, especially after the last week's election and winning the extremists.
After all, in the week ahead, eyes will turn on the OPEC+ meeting, where they will probably see an opportunity of raising the production. Market reaction will depend on the amount of raise and demand expectation. Besides the OPEC+ announcement, we have to follow Wednesday's EIA (Energy Information Administration) inventory report and Friday's Baker Hughes Total Rig Count numbers.
Technical Overview:
While in the Daily chart, RSI moves ta an overbought area above 70 levels, in the midterm charts (H4), RSI decreased to 55, and in the H1 chart, it is lower than 50-level, at 43. Thus, fundamental data and news are still very supportive of the Oil Market. Even though technically we can see some signals of decrease in the prices, even if we can see the correction in the charts, it should be short-lived sell opportunities. $72.50 is the critical support for the WTI.
