Crude Oil, WTI, Brent – Talking Points
- Crude oil prices rises above critical resistance as supply dwindles
- OPEC+ resists calls to increase output as Omicron weighs on demand
- Oil continues to test key technical levels as bulls strive to break above critical resistance
Has Covid Reached its Peak?
As global lockdowns continue to weigh on risk sentiment, rising geopolitical tensions combined with an optimistic perspective surrounding the global economic recovery has forced Oil prices into a well-defined range, currently providing support and resistance for the short-term move.
Despite a rise in energy prices, key organizations (such as OPEC+) have agreed to keep supply suppressed while the Omicron variant continues to trigger fear throughout global markets.
As fears surrounding outlook continues to rise, both fundamental and technical factors will likely contribute to 2022.
Oil – US Crude (WTI) Price Action
Over the past five weeks, WTI crude oil has continued to trade above channel support, formed by the key psychological level of $62.00.
As the Omicron variant continues to weigh on demand, supply constraints combined with a decline in production has kept oil prices afloat, at least until now.
On the weekly time-frame, price action is currently trading within a well-defined range, between the key Fibonacci of both the historical (2008 – 2020) and the 2021 move has continued to keep both bulls and bears at bay, providing critical levels of support and resistance levels for the imminent move
Oil Weekly Chart
Chart prepared by Tammy Da Costa using TradingView
Meanwhile on the daily chart below, prices have temporarily risen above the 61.8% retracement of the historical (2008-2020) move at approximately $75.41 while the CCI (commodity channel index) enters into overbought territory.
Oil Daily Chart
Chart prepared by Tammy Da Costa using TradingView
| Change in | Longs | Shorts | OI |
| Daily | -4% | 47% | 4% |
| Weekly | -22% | 76% | -11% |
--- Written by Tammy Da Costa, Analyst for DailyFX.com
Contact and follow Tammy on Twitter: @Tams707
