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WTI crude oil hits $62 – where to now? (OIL, ENQ, PMO, TXP, NTOG, AMER, TLOU, UJO $CL_F)

The oil price has had a good run so far this year, with WTI crude hitting $62 this week. It’s a key level for the commodity as it looks to break completely free from a considerable area of resistance formed in 2015.

Since oil’s sharp pullback in the last quarter of the year, price action has been coiling into a rising wedge.  More often than not, this is a bearish pattern but WTI looks strong at the moment and could buck the trend. The top of the pattern is currently being tested, and if successful, WTI could march on to the next major resistance zone around $66-68.

The Relative Strength Index (RSI) is poised for a run, currently hovering at 59. An RSI entering the 60-70 zone typically coincides with a stronger move to the upside.

All eyes will be on the API inventory figures released tonight, and even more so on the EIA numbers tomorrow. An inventory drawdown is forecast and could be the catalyst to push WTI towards the mid-60s.

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  • Stuart Langelaan currently holds a position or positions in the stock(s) and/or financial instrument(s) mentioned in the piece.
  • Stuart Langelaan has not been paid to produce this piece by the company or companies mentioned above.
  • Dynamic Investor Relations Ltd, the owner of ValueTheMarkets.com, has not been paid for the production of this piece by the company or companies mentioned above.

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