West Texas Intermediate (WTI) oil prices surge on slow U.S. output restart

February 23, 2021 - 3 days ago
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The benchmark for New York-traded crude oil prices staged a sharp U-Turn on Monday and took the trip back to the 13-month highs, as U.S. output was slow to restart after a deep freeze in Texas shut-in crude production last week.

The arctic cold snap and power cuts affected more than 20 refineries in Texas, Louisiana and Oklahoma, with a combined processing capacity of over 5.5 million barrels a day.

However, it may take at least 2-weeks before shale oil producers in the southern United States to restart the more than 2 million barrels per day (bpd) of crude output.

However, the bullish sentiment has possibly given support to a further round of up tests.

Bearish divergence is still evident. Traders can take advantage of divergence by using a variety of trend-based strategies.

Divergence is a popular trading signal because they are dynamic and most often offer a reliable, high-quality trading signal reversal when combined with other trading tools and concepts.

In technical analysis, divergence can be a significant warning signal that a bullish or bearish trend is coming near an end.

Divergence appears when a technical indicator (oscillator) begins to establish a trend that disagrees with the actual price movement. These “disagreements” are strong signals and somewhat useful for the trader/investor.

At present, the upside views a potential target of $65.00-25 before any reversal.

Conversely, a New York close beneath $59.30 should give a bearish call to $57.00-25. Reassess from there.

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