WTI hits fresh 3-week highs above $ 54

Having witnessed a bullish opening gap in Asia this Monday, oil futures on NYMEX accelerates gains and now looks to test Jan-end highs reached at 54.34 levels.

The black gold is seen breaking higher from last week’s consolidation range, in wake of latest CFTC data, which showed that the investor optimism on WTI oil prices reached an all-time high amid high compliance to the OPEC output cut deal.

However, it remains to be seen, for how long oil can survive above $ 54 mark, as increase in US rigs count and record stockpiles continue to undermine the sentiment around the commodity. 

Later today, oil prices are expected to remain buoyed amid subdued trading activity as the US will be closed on Monday for the Presidents Day holiday.

Focus shifts towards the API crude inventory report due out on Tuesday and the official US government figures on the US crude stockpiles, which will be published by the EIA on Wednesday.

WTI technical levels        

A break above $ 54.50 (psychological levels) could yield a test of $ 55.24 (Jan 3 high). While a breach of support at $ 53.73 (daily low) would expose the 50-DMA support of $ 53.06.