FxWirePro: US oil Short-Term Outlook

US oil was one of the worst performers in the past 3-week and lost more than 20% from a temporary top $62.97. The decline was mainly due to the outbreak of coronavirus, which will reduce the demand for crude oil. The death toll has been increased to 213 in China, the number of cases confirmed surged past 9000. It hits low of $51.69 and is currently trading around $52.82.

According to EIA, U.S crude oil supplies rose by 3.5 million compared to a forecast of 1.4 million barrels. The rise in inventory also putting pressure on WTI crude oil prices.

On the flip side, significant support is around $50.50 and any indicative break beneath will drag the US oil till $49.45/$47.55.

The immediate important resistance is around $55, the decline from $62.97 will get over if it breaks above $55. Any violation over $55 targets $57.50/$60. The secondary resistance is at $53.35/$54.

It is good to buy on dips around $50.60-70 with SL around $50 for the TP of $55.