Any upside continuation faces stiff resistance, with the 50-day moving average at $62.77, a swing top at $62.92, and the 200-day moving average at $62.98. Of note, the 50-day has crossed below the 200-day, forming a bearish “death cross” that signals long-term weakness. Unless bulls can overcome this cluster decisively, rallies are likely to be viewed as selling opportunities.
On the downside, a failure to hold $58.22 would signal renewed selling pressure, potentially exposing the next major support at $55.74.
U.S.-China Trade Tensions Keep Traders on Edge
Oil’s rebound is partially driven by renewed investor focus on a potential meeting between U.S. President Donald Trump and China’s Xi Jinping. The meeting, tentatively slated for later this month on the sidelines of the APEC summit in South Korea, could determine whether the current tariff standoff escalates or finds relief.
Last week’s oil selloff followed an expansion of Chinese rare earth export controls and Trump’s announcement of 100% tariffs on certain Chinese goods. Market participants remain highly sensitive to any signs of resolution or further deterioration in trade talks, which significantly impact global demand sentiment for crude.
China’s Crude Imports Provide Limited Demand Support
On the demand front, China’s crude oil imports rose 3.9% year-over-year in September to 11.5 million barrels per day, according to customs data. While the increase is notable, it has done little to offset broader demand concerns tied to trade uncertainty and regional conflict resolution in the Middle East.
