WTI trades with mild negative bias around $81.00 mark, bullish potential seems intact

West Texas Intermediate (WTI) US crude Oil prices tick lower during the Asian session on Friday, albeit lack follow-through and remain well within the striking distance of the highest level since late April touched the previous day. The commodity currently trades around the $81.00/barrel mark and seems poised to register strong gains for the second successive week. 

Data published by the Energy Information Administration (EIA) on Thursday showed a larger-than-expected drawdown in US crude stockpiles and reaffirmed expectations about a tighter market in the second half of the year. This, along with concerns that a wider Middle East conflict will lead to potential disruption to global supplies from the key producing region, continues to act as a tailwind for Crude Oil prices and validates the near-term positive outlook.

Meanwhile, investors have been pricing in a greater chance that the Federal Reserve (Fed) will begin its rate-cutting cycle in September and the bets were further reinforced by Thursday's softer US macro data. This turns out to be another factor lending some support to Crude Oil prices, though a modest US Dollar (USD) strength, bolstered by the overnight sharp rise in the US Treasury bond yields, might cap further gains for the USD-denominated commodity. 

Nevertheless, the aforementioned fundamental backdrop seems tilted in favor of bullish traders. Moreover, the recent breakout through technically important 100-day and 200-day Simple Moving Averages (SMA) suggests that the path of least resistance for Crude Oil prices is to the upside. Hence, any meaningful slide is more likely to attract fresh buyers and remain limited. Traders now look forward to the release of the flash global PMIs for short-term opportunities.