WTI oil nears 200-DMA hurdle

US oil prices extended the recovery from Monday’s three-month intraday low to trade within a touching distance from the 200-DMA hurdle of $43.95.

Oil trades above the downward sloping hourly 50-MA

At the time of writing, oil prices were trading well above the still downward sloping hourly 50-MA of $43.54.

Prices clocked a three-month intraday low of $42.18 on Monday as the Dollar index rose to 11-month high. Furthermore, scepticism that that OPEC will be able to cut production to between 32.5 million and 33 million barrels a day, also weighed over the oil prices.

The uptick seen today appears mainly due to oversold conditions on the technical chart. The focus today is on the US American Petroleum Institute (API) data.

WTI oil Technical Levels

Prices were last seen trading around $43.85. A break above $43.95 (200-DMA) would open doors for $44.41 (10-DMA), above which the round figure of $45.00 could be put to test. On the other hand, a breakdown of support at $43.53 (session low) would shift risk in favor of a drop to $43.12 (Nov 9 low) and $42.18 (Monday’s low).