Oil is trading higher today with Brent breaking back above $63 handle and WTI recovering above the $60 mark. Crude is in the spotlight today as OPEC+ group will hold a meeting and is expected to announce decision on production levels for coming months. It looks likely that oil producers will decide to extend current output cuts as the latest group's forecast for global demand was lowered by 300kbpd and new lockdown measures were recently announced in France and Canada. Joint Ministerial Monitoring Committee recommended to extend the "compensation period" until end of September 2021 in order to compensate for previous overproduction. JMMC also said that global stockpiles still remain above the 2014-2019 average.
Taking a look at OIL.WTI chart at H4 interval, we can see that the commodity is trading within a downward channel. Price has pulled back after a failed attempt of breaking above the upper limit of the channel and $62 resistance zone. In case OPEC+ disappoints and allows production to rise, oil prices may find themselves under pressure. In such a scenario, $57.70 area will be a support to watch. On the other hand, if OPEC+ decides to leave production unchanged, oil may catch a bid with the aforementioned upper limit of the channel being the first resistance to watch.
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Source: xStation5
