WTI sits at 11-month tops above $51 mark ahead of US NFP, rigs data

• WTI consolidates above $51, fresh multi-month highs.
• DXY’s pullback, Saudi cuts and global economic recovery hopes support.
• Next of note for the US oil remains the NFP and rigs count data.

The buying interest around WTI (futures on NYMEX) remains unabated, as the bulls probe eleven-month highs above the $51 mark ahead of the US payrolls and rigs count data.

The US oil continues to remain underpinned by the risk-on market mood, fuelled by expectations of a bigger US stimulus after the Democratic victory in Georgia’s run-offs. More fiscal support implies prospects of faster economic recovery, which bodes well for the higher-yielding oil.

The black gold also draws support from the retracement in the US dollar from weekly highs. A weaker greenback makes the USD denominated oil cheaper for foreign buyers. Markets are resorting to profit-taking on the dollar’s rebound ahead of the critical US labor market report.                                

From a broad perspective, the American oil benchmark continues to draw support from Saudi Arabia’s unexpected decision to voluntarily cut oil output. At the OPEC+ meeting held earlier this week, Saudi announced it will cut output by an additional 1 million barrels per day (bpd) in February and March.

Markets now await the US jobs report and Baker Hughes weekly rigs count data for near-term trading opportunities in the prices.

WTI technical levels

“.. multi-day high of $51.30 can offer immediate resistance to the quote ahead of directing it to the stated pattern’s upper line near $51.55. However, any downside break of $50.95 will not hesitate to recall the sellers targeting the 200-hour EMA level of $49.15. During the fall, the $50.00 psychological magnet will be important,” FXStreet’s Analyst Anil Panchal noted.

WTI additional levels