Crude oil continues the trip north adding more than $2 to $57.10 as the dollar denominated assets buying frenzy continues. Central bank easing from RBA, ECB and FED, along with an improved sentiment on US-China trade war, and an escalation in USA – Iran tension leads to stronger demand for crude oil. The Energy Information Administration announced yesterday a larger-than-expected draw in USA crude oil supplies during the previous week.
Black gold is in bullish momentum as earlier this week has breached all the major hourly moving averages, and today continues with another leg higher breaking above the 20 and 150 day moving averages. Crude oil immediate support stands at 55.98 the 150 day moving average and if the price breaks below, the selloff will intensify and we might test the 20 day moving average at 54.43. On the upside first resistance stands at 58.54 the 100 day moving average while next resistance stands at 59.71 where the 50 days moving averages cross. All in all bulls are in drivers’ seat for now and higher level is on the cards.