WTI crude oil price CFDs is off to a cautiously bullish start in today’s trading. After it opened at $28.76, the commodity has tracked higher to an Asian session high of $30.15.
However, it may be difficult for crude oil price to sustain its gains above $30.00 in today’s trading. There are no key reports scheduled that could affect the commodity. Instead, we have heard more countries like the US, Canada, Spain, and France impose tougher quarantine measures, limiting travel even more. Of course, this means that demand for oil will continue to be dampened.
The next problem that investors are bracing for is the effect of containment in US oil market. It has been said that it costs US oil producers $50.00 to drill a barrel. With the commodity trading below $30.00, it does not make sense for oil companies to continue drilling at normal capacity.
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Crude Oil Price Outlook
On the hourly time frame, we can see that WTI crude oil price CFDs has some room to trade higher and still maintain its downtrend. By connecting the highs of March 11 and March 13, we can see that there is trend line resistance around 31.70. This price also offers other sources of resistance. For one, this price level coincides with the 100 SMA. It also aligns with the 61.8% Fib level when you draw the Fibonacci retracement tool from the high of March 13 to the low of March 16. If there are enough buyers in the market, we could see WTI crude oil price rally to this price. A break of this price could even mean that the commodity would soon rally to 33.47 where it topped on March 13.
Alternatively, a bearish close below today’s open price could mean that WTI crude oil price may soon fall to its 2016 lows at 26.01.
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