FxWirePro: WTI crude to hit $60 sooner or later but sustenance above $50 likely, bullish engulfing pattern stems in new phase consolidation

Well, WTI crude prices have hit $50 mark again, that is where you could trace out a bullish engulfing candle pattern in this week with one to spare.

Clearly, yesterday's OPEC production cut agreement was much more important for the global oil complex. However, for those following the routine fundamental data flow, this week's US stats were bullish for crude and bearish for refined products.

Crude stocks drew against expectations, as imports remained relatively low following the previous week's large drop. The draw came despite a drop in refinery runs, which in preceding weeks had been rising seasonally.

Turning to refined products, distillate and gasoline saw larger-than-expected builds, with domestic fuel production continuing to climb in the wake of refinery maintenance season. Total US 4w av. product demand grew by 191 kb/d to 19.83 Mb/d (+1.0% y-o-y).

From last two-three weeks, the rallies have resumed after testing strong support at 42.23 levels.

For now, the extension of these upswings upto 51.54 seem to be most likely supported by healthy momentum and fundamental news, the break above these levels to hit 54.50 and 60 levels in the medium run. This may be achieved gradually but we could now see the sustenance above $50 owing to both fundamental as well as technical grounds.

To substantiate this bullish stance, both leading oscillators on weekly and monthly terms are indicative healthy bullish momentum.

We call for $55-$60 in the medium run, while the sustenance above $50 seems to be most likely in short run.