WTI off-lows, regains $ 74 ahead of EIA data

Looking to extend the bounce beyond $ 74 mark amid weaker USD.
Expectations of the US EIA stockpiles draw buoy oil prices.

Dhwani Mehta FXStreet

WTI (oil futures on NYMEX) regained the $ 74 threshold in the European session, reversing a dip to $ 73.67, as a broadly weaker US dollar and improved risk sentiment lent support to the prices.

The black gold keeps its recovery mode intact on the back of the ongoing weakness in the US dollar across its main peers combined with a better sentiment towards risk assets. A weaker greenback makes the USD-denominated oil cheaper for the holders in foreign currencies and vice-versa.

More so, expectations of a drop in the US crude stockpiles due to be published by the EIA later on Thursday, following the bullish API crude inventories report, helps underpin the sentiment around the barrel of WTI.

Furthermore, the bulls also derived support from an Iranian threat to block shipments through the Strait of Hormuz while comments from the Iranian government, asking Trump to stop tweeting on oil prices, also helped.

Oil prices fell earlier today as Trump demanded that the OPEC cartel reduce crude prices. Also, escalating US-Sino trade tensions, with tariffs deadline looming on Friday weighed negatively on the prices.

WTI Technical Levels:

Resistances: $ 74.76 (July 4 tops), $ 75 (round number), $ 75.27 (multi-year highs).

Supports: $ 73.67 (daily low), $ 73.37 (Fib S2), $ 72.62 (June 2nd low).

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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