WTI: Traders looking to $60bbls while above $57.93bbls technical level

• WTI is currently trading at $59.06bbls between a range of $58.08bbls and $59.21bbls.
• Technicals are aligned bullishly.

WTI has climbed on Monday following the weekend news that OPEC members have agreed to trim 800,000 barrels a day from October’s production levels for six months through June of this year, with Russia and other allied producers cutting another 400,000 barrels a day to total 1.2 million barrels in cuts.

On Monday, another meeting took place between the Joint Ministerial Monitoring Committee, (JMMC), where “overall conformity” was seen rising to almost 90% in February, up from 83% in January - The Joint Ministerial Monitoring Committee is a production policy monitoring group that includes Saudi Arabia and Russia.  Meanwhile,  the output cut agreement has led to a more than 25% rise in price of Brent oil YTD. 

The JMMC recommended that OPEC forgo a meeting scheduled for  April and instead it should take place on June 25 to make a decision on the production target for the second half of the year.

Traders eyes are now on the Energy Information Administration data. 

• EIA estimates that U.S. crude oil production averaged 11.9 million barrels per day (b/d) in February, down slightly from the January average. EIA forecasts that U.S. crude oil production will average 12.3 million b/d in 2019 and 13.0 million b/d in 2020, with most of the growth coming from the Permian region of Texas and New Mexico.

WTI levels

While the price holds above the double-top highs and above the 57.93 horizontal prior resistance line going back to mid-Nov 2018, the market leans bullish. However, a break of 59.70 is needed where bulls will then look to the 61.8% Fibo of the Oct 2018 sell-off to late Dec lows at 63.74, reviving prospects for the 70 handle. On the flipside, a fall to 54.50 will open a case for 50.50 as the 23.6% Fibo support structure.