WTI upside remains capped near $54.00

Crude oil prices have retraced the earlier bullish attempt, with the barrel of West Texas Intermediate finding strong resistance around the $54.00 mark.

WTI weaker on USD buying

The better tone in the greenback keeps limiting the upside in USD-denominated assets at the end of the week, as uncertainty over the potential policies under Trump’s presidency appears somewhat mitigated.

In addition, concerns over the pick up in US oil production remains on the rise following the recent increase in oil supplies as reported by the API (Tuesday) and the EIA (Wednesday) along with a rebound in the US drilling activity.

The likeliness of the re-emergence of jitters over the oil supply glut threatens to offset the ongoing oil output cuts by OPEC and non-OPEC countries, as agreed late in 2016, all weighing on sentiment and capping gains.

WTI levels to consider

At the moment the barrel of WTI is down 0.50% at $53.52 facing the next support at $53.24 (low Jan.27) followed by $52.79 (low Jan.25) and then $52.60 (20-day sma). On the upside, a surpass of at $54.06 (high Jan.26) would open the door to $54.32 (high Jan.6) and finally $55.24 (2017 high Jan.3).