WTI back above $ 62 mark, but for how long?

• Firmer, despite DXY recovery.
• Rebound in global equities, geopolitical tensions support.

WTI (oil futures on NYMEX) extends its last week’s recovery mode and trades with sizeable gains in the European session, having hit fresh two-week highs of $ 62.39 earlier today.

The barrel of WTI is seen consolidating its Asian advance, as the bulls take a breather before the next push higher. The sentiment around the black gold remains underpinned by mounting geopolitical worries in the Middle East, especially in the wake of Israeli PM Netanyahu’s comments that Israel could act against Iran itself after border incidents in Syria.

More so, improved risk appetite amid a recovery in global stock markets also boosted the demand for the higher-yielding oil. However, it remains to be seen whether the black gold can sustain above the $ 62 mark, as a broad-based US dollar recovery combined with the rise in the US rigs count numbers could keep a check on the prices.

The US oil rig count rose by seven to 798, its highest since April 2015, Friday’s Bakers and Hughes Oilfield Services data showed.  

Attention now turns towards the weekly US crude supplies report due later this week for near-term direction on oil prices.

WTI Technical Levels

At $ 62.09, the resistances are aligned at $62.48/61 (50 & 20-DMA) ahead of $63 (round figure) and $63.77 (Jan 19 low). On the downside, the supports are located at $ 61.51/49 (daily low/ 5-DMA), $60.27 (Feb 8 low) and $ 60 (psychological support).