WTI Rises Above $64.50 on Inventory Drop & Tensions.
WTI edges higher above $64.50 following an unexpected decline in US crude inventories
FUNDAMENTAL OVERVIEW:
West Texas Intermediate (WTI), the US crude oil benchmark, trades around $64.55 during Thursday’s North American session, edging higher on the back of an unexpected decline in US crude inventories and concerns over potential supply disruptions from Ukrainian strikes on Russian energy infrastructure.
Data from the US Energy Information Administration (EIA) showed that crude stockpiles fell by 607,000 barrels for the week ending September 19, following a 9.285 million-barrel drop the previous week. Analysts in a Reuters poll had anticipated a 235,000-barrel increase.
Geopolitical tensions add further support to prices. US President Donald Trump suggested NATO nations should target Russian aircraft violating their airspace, while Ukraine has stepped up drone attacks on Russian refineries and export hubs to limit Moscow’s export revenues.
On the macro front, Fed Chair Jerome Powell maintained a cautious stance on further easing, emphasizing the need to balance high inflation against a weakening labor market. Chicago Fed President Austan Goolsbee also warned against a series of rate cuts, a stance that could strengthen the US Dollar (USD) and temper near-term gains for USD-denominated commodities like WTI.
CRUDE OIL TECHNICAL ANALYSIS CHART:
Technical Overview:
Crude Oil is trading within a down channel.
Crude Oil is moving above all the Moving Averages (SMA).
The Relative Strength Index (RSI) is in Buying Zone, while the Stochastic oscillator suggests Positive trend.
Immediate Resistance level: 66.05
Immediate support level: 63.15
HOW TO TRADE CRUDE OIL
After a strong rally, crude oil prices dropped sharply, breaking a key support level and trending lower below critical resistance. Recently, the commodity rebounded from the support zone, surged past the trendline resistance, and is now undergoing a pullback. If the trendline holds as support, crude oil could resume its upward movement toward major resistance levels.