Oil prices are back on track, and buying pressure is building up for both Crude and Brent oil. Their prices surged over 1% yesterday, and prices are trading higher today as well. A lot of this is pure because traders are feeling a lot more optimistic about the strength in the economic data. Economic numbers are coming strong from the two biggest economies of the world, China and the US. March data showed that the US services activity hit a record high, and there was an echo of this message in the Chinese services sector.
Having said that, oil traders are still somewhat cautious with their approach as the resurgence of COVID-19 infection remains a challenge. The COVID situation has deteriorated substantially in India, where the third wave of coronavirus has become a lot more dangerous than the previous ones.
Speaking from a technical perspective, crude oil needs to break above the 50-day simple moving average on the daily timeframe, and only that will confirm that oil prices can continue their momentum to the upside. The same goes for Brent oil price as well which is also trading below the 50 day simple moving average on the daily timeframe.
