WTI takes on the recovery above $ 44, eyes on EIA report

Dhwani Mehta FXStreet

Oil futures on NYMEX paused its four-day bullish run on Wednesday, as the sentiment remains undermined by bearish API crude inventory report. However, the commodity is on a minor-recovery mode so far this session, looking to regain the bids above $ 44 mark.

The tepid recovery seen in the black gold can be mainly attributed to the renewed selling pressure seen in the US dollar versus its major peers, with the DXY hitting fresh seven-month lows just ahead of 96 handle.

Oil prices witnessed a sharp drop in the overnight trades after the API crude inventory report showed that the US inventories rose by 851,000 barrels in the week to June 23 to 509.5 million, compared with expectations for a decrease of 2.6 million barrels. Unexpected build in the US crude reserves re-ignited supply glut concerns.

All eyes now remains on the official US government oil reserves data due later today on Wednesday for fresh trading impetus. At the time of writing, WTI trades -0.35% lower at $ 44.11, while Brent trades modestly flat at 46.84 levels.

WTI technical levels

Anton Kolhanov, Chief Technical Strategist noted: “We can expect start of downtrend from resistance level 44.45 - 44.90 with target on support 42.50 and lower, on 41.30 - 38.00. The uptrend may be expected to continue in case the market rises above resistance level 44.90, which will be followed by reaching resistance level 46.20.”

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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