FxWirePro: US oil rangebound at 5-DMA support, rising covid cases weigh

Chart - Courtesy Trading View 

US oil keeps to narrow ranges on Monday, trades at $79.01 at around 07:20 GMT, with session high and low at 79.29 and 78.39 respectively.

Rapidly climbing Omicron COVID-19 cases across the globe which are expected to hit economic activity are weighing on oil demand.

OPEC's output in December rose by 70,000 bpd from the previous month, versus the 253,000 bpd increase allowed under the OPEC+ supply deal.

Supply additions from OPEC+ are not keeping up with demand growth. Supply disruptions are likely to support prices and keep downside limited.

The pair has retraced dip below 200-DMA during the December month. GMMA indicator has turned bullish in the near-term. 

Price action has broken above daily cloud. Volatility is high and momentum is bullish. 

Support levels - 78.41 (5-DMA), 77.12 (200H MA), 75.64 (21-EMA)

Resistance levels - 80.45 (Previous week high), 80.87 (Upper BB), 83.65 (Trendline)

Summary: Technical bias for the pair is bullish. Scope for test of 83.65 (trendline resistance) in the near-term. Bullish invalidation only below daily cloud.