- WTI price is extending the recovery from 10-day lows on Friday.
- Oil demand concerns and risk-on market mood boost the black gold.
- Buyers target $118.50 on the renewed upside amid bullish daily RSI.
WTI (NYMEX futures) is strongly bid in the European session on the final trading day of the week, benefiting from the renewed appetite for risk-sensitive assets such as oil.
Concerns over global demand outlook on one side and supply tightness on the other underpin the sentiment around the black gold. Russian Deputy Prime Minister Novak said early Friday, “we see turbulence in global oil markets, uncertainties over oil production recovery in Iran, Libya, Venezuela.”
The US sanctioned Chinese and Emirati companies and a network of Iranian firms that help export Iran's petrochemicals, which re-ignited fears over supply tightness.
From a short-term technical perspective, WTI is looking to test the bearish wedge support now turned resistance at $118.50 on the road to recovery, as it has reclaimed ground above the critical 21-Daily Moving Average (DMA) at 115.14.
Note that the price confirmed a rising wedge breakdown on Wednesday after closing below the rising trendline support, then at $116.93.
Buying resurgence could see a retest of Wednesday’s high at $116.92 should bulls manage to find acceptance above the $116 mark.
The 14-day Relative Strength Index (RSI) is pointing north above the midline, suggesting that recovery seems to have legs in the near term.
WTI: Daily chart
On the flip side, 21 DMA will guard the immediate downside if sellers jump back into the game. The next stop for sellers is seen at Wednesday’s low of $112.37 before the weekly lows of $110.33 could be attacked once again,
Although the path of least resistance appears to the upside for the US oil, it is set to end the week on a negative note.
