TenkoFX - Analytics


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    Oil back sub-$50.00 on profit taking

    Strong bid-tone surrounding the greenback prompted traders to continue unwinding their bullish bets, dragging WTI crude oil back below $50.00 psychological mark.Currently trading at session low level of $49.65, down over 3.5% from nearly one year high of $51.64 touched on Thursday, the black gold is still headed for a fourth week of gains in the previous five. Jittery global financial markets are seen boosting the safe-haven demand for the greenback and thus dragging dollar-denominated commodities, like oil. Further, resumption of Canadian supplies after last month's wildfires in Alberta's oil sand seems to pose additional headwind for the commodity.However, global supply disruption worries led by militant attacks in Nigeria might restrict any sharp downfall in oil prices. Technical levels to watchOn a sustained weakness below $49.70 could lead to a further slide towards $49.00 round figure mark support, which if broken might extend the near-term corrective.On the flip side, resumption of the near-term bullish momentum above $50.00 might now confront resistance near $50.50 level, which is followed by resistance near yearly high level of $51.60-65 zone. Only a convincing break through multi-month high resistance would pave way for further near-term up-move for the commodity.

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