WTI Rebounds amid Two Parties’ Possible Agreement

WikiFX News (29 Sept.) - Recently, the Wall Street equity indices ended higher over 1% while the WTI closed above 1.53% as the two parties are expected to agree on a new round of fiscal stimulus bill. The following actions of OPEC+ are thrust into the spotlight since the pandemic has encumbered crude oil from an upbeat outlook.

The Speaker of the House of Representatives said the two parties could find a “consensus” on the stimulus package, and the Fed official Loretta Mester said the loose policy would dominate for quite some time.

Considering a second wave of the pandemic is raging across Europe and the U.S., the two parties are increasingly expected to reach a compromise. If the final package achieves over $2 trillion, markets will embrace a prosperity. Against the background, the three U.S. stock indices closed higher over 1% with WTI adopting a rebound and establishing a firmer footing above $40.0.

Looking ahead, oil prices may see its rally extend in the short term. However, the rally is expected to be limited, considering oil prices are facing a strong resistance above $43.0-44.0 and the outbreaks in Europe and the U.S. will further drag down the oil demand. Once the demand declines, OPEC+ is likely to postpone the production cut of “gradual step down”, which will boost oil prices.

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Chart:Trend of Nasdaq