WTI off seven-week lows, re-takes $56 ahead of EIA data

• WTI attempts a bounce amid profit-taking after steep losses.
• China virus outbreak could weigh on oil demand if it dents economic growth.
• All eyes on US weekly EIA Crude Stock data for fresh direction.

WTI (oil futures on NYMEX) is seen making minor recovery attempts in the European session and looks to regains the 56 level, having reached the lowest level in seven weeks at $55.59 in early hours.

The prices fall for the fourth consecutive day this Thursday and shed over 1.50%, as the sentiment around the black gold remains dampened by expectations of weakening oil demand, in the wake of rising concerns that the China coronavirus outbreak could hurt the global economic recovery.

Moreover, broad-based US dollar strength amid strong US fundamentals and virus scare induced increased safe-haven demand also backed the case for the recent bearish bias in the barrel of WTI.

Over the last hour, the bulls are fighting back control, lifting the rates back to the 56 mark, as markets seek to take profits off the table after the recent declines heading into the release of the US weekly Crude Oil Stocks data due to be published by Energy Information Administration (EIA) at 1600 GMT.

WTI Technical levels to consider