The WTI crude oil price benchmark is up for the 4th day in a row, as optimism around the possibility of having a coronavirus vaccine available in December lifted risky commodity assets on Monday.
Pfizer has indicated that the UK may approve the vaccine it developed with BioNTech, while the FDA is expected to grant emergency use approval this week. This clears the way for vaccinations to start in December if all goes according to plan.
Meanwhile, the CFTC Positioning report has indicated an increase in the number of speculative bullish bets on WTI crude oil futures in the week just ended. Speculators raised their net long positions on the WTI crude oil futures by 3,100 contracts, signifying an increase in buying interest in the asset.
Adding to bullish sentiment is the expectation that the OPEC + alliance could keep the 2020 oil production curbs in place beyond January 2021 at its meeting scheduled for the end of November.
Only additional restrictions and lockdowns in several cities in the US, as well as untamed infection rates globally, continue to raise demand concerns, thus providing potential headwinds to crude oil prices.
Technical Levels to Watch
The rising wedge on the daily chart is the pattern to watch for the WTI crude oil price benchmark. The limiting price for buyers at the moment stands at 43.62. A break of this price level to the upside puts the WTI on the path towards the 3 March 2020 high at 48.32. However, the 23 February low at 45.94, which also serves as the low of 5 March, could serve as a pitstop to this move. Above these levels, the 49.60 and 50.79 price levels (10 February low and 18 February low respectively) round off potential near term targets.
On the flip side, a rejection at 43.62 sets the stage for a potential breakdown of the wedge. A wedge breakdown sets up a likely measured move towards the 27 March and 6/7 May highs at 27.88. However, the actualization of this price projection requires that sellers take out 40.93, 36.89 and 34.81, all in sequence. The 10/12 March low at 29.78 needs to give way as well in a price move which could take a convoluted trajectory as risk sentiment continues to dominate crude oil price action.
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Daily Chart; WTI Crude Benchmark
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