WTI rallies over 2% to tap on $42, strongest since March

• WTI jumps on vaccine, demand recovery hopes and EU deal.
• Oil sees the biggest daily rise since mid-June.
• All eyes on API crude stocks data, US virus stats.

WTI (futures on Nymex) is witnessing its biggest daily rise in over a month, as bulls briefly conquer the 42 level to hit the highest level since March.

At the press time, the US oil eases to 41.80, still adding 2.15% on the day. The black gold spiked nearly 80 cents in a matter of 15 minutes, as the risk sentiment received a further boost in the European session.

Investors cheered the European Union (EU) stimulus deal, which propped up expectations of a quicker economic rebound in the bloc. This, in turn, boosted the hopes for the recovery in the fuel demand.

Moreover, the progress on the coronavirus vaccine combined with the additional US stimulus talks lifted the appetite for the higher-yielding assets such as oil. Additionally, broad US dollar weakness also collaborated with the strength in the USD-sensitive barrel of WTI.

Attention now turns towards the US weekly crude stocks data due to be published by the American Petroleum Institute (API) later in the NA session. Also, of note remains the US virus stats and the sentiment on Wall Street for near-term trading opportunities.

WTI technical levels to watch

“In a case where the bulls remain dominant past-$41.65, February month’s low around $44.00. the sellers are waiting for entries below $40.00 to target the monthly bottom around $38.70 and the late-June low near $37.20. Additionally, $39.00 and June month’s bottom surrounding $34.50 could act as extra levels to watch during the quote’s further weakness,” explains Anil Panchal, FXStreet’s Analyst.

WTI additional levels