- Broad-based US dollar pullback to drag prices lower, as the bears target 200-DMA at $ 64.75.
- Awaits US API weekly crude supplies report for the next leg down.
Having consolidated around the $ 65.50 level so far this Tuesday, WTI (oil futures on NYMEX) is seen breaking lower from the range trade, as the bears regain poise heading towards the US weekly fuel stocks data due to be reported by the American Petroleum Institute (API) later at 2030 GMT.
The barrel of WTI turned negative and refreshed daily lows at $ 65.33 on the back of a minor rebound staged by the US dollar across its main competitors. The US dollar index fell to weekly lows at 95.45, in response to Trump’s remarks on the Fed’s rate hike policy.
However, the black gold is likely to find some comfort from increased expectations of tightening global fuel markets. Meanwhile, the concerns over the additional US sanctions on Iran, targeting Iran oil sector from November, also kept the sentiment around the commodity somewhat buoyed.
Looking ahead, cautious trading is likely to extend ahead of the US-China trade talks, especially after Trump noted that he does not expect much progress and that resolving the trade dispute with China will “take time”.
For today, the US API crude stockpiles data will be closely eyed for any near-term trading opportunities.
WTI Technical Levels
Omkar Godbole, FXStreet’s Analyst, offers key technical levels for trading WTI this Tuesday.
R1: $65.61 (daily high)
R2: $66.00 (psychological hurdle)
R3: $66.36 (Aug. 8 low)
Support
S1: $65.41 (session low)
S2: $64.75 (200-day MA)
S3: $64.45 (Aug. 16 low).”
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