- WTI recovered to $90.00 in Tuesday trading after dipping to a session low of $87.73.
- Crude oil prices remain well-bid as supply constraint fears bolster barrel costs.
- Broad-market risk aversion preventing further climbs up the chart for WTI.
West Texas Intermediary (WTI) US crude oil prices have reclaimed the $90/bbl handle in Tuesday's trading window after hitting a two-week low early in the day of $87.74.
US crude reserves are rapidly dwindling in the face of a global supply deficit of nearly 2 million bpd. The major crude reservoir at Cushing, Oklahoma has reached 14-year lows, and declining reserve supplies will provide further upside price pressures for WTI.
Cushing reserves have reversed rapidly; the facility hit a two-year reserve high in June of 43 million barrels and is now sitting just below 23 million barrels, its lowest stock supply since last July.
Despite broad-market risk aversion sending risk assets lower on the day, WTI US crude has caught a bump on the charts.
Despite ongoing supply constraints on the heels of Saudi Arabia and Russia's 1.3 million bpd production cut extensions through the end of the year, upside pressure on oil prices could see a ceiling sooner than many analysts expect.
US crude production has been ramping up as of late, and despite a declining number of active oil rigs and wells, efficiency in the crude sector is steadily rising, and US oil production continues to creep higher.
US crude production in September is expected to hit production levels on par with 2019's record-setting 13 million bpd.
WTI technical outlook
US crude oil is up over 2.5% from Tuesday's lows, remounting the $90/bbl handle and poised for further gains as long as crude bulls can keep the bid line over the 200-hour Simple Moving Average (SMA) currently priced in at $89.90.
On the daily candlesticks, crude prices remain firmly on the topside, with technical indicators breaking down as they remain pinned firmly in overbought territory. The Relative Strength Index (RSI) has been at or near overbought territory for nearly a month straight on a 14-day rolling basis.
The 200-day SMA remains well below current price action, turning mildly bullish from $77.00, and the 34-day Exponential Moving Average (EMA) is providing technical support from just beneath the $86.00 handle.
WTI 4-hour chart
WTI technical levels
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Recommended content
Editors’ Picks
EUR/USD bounces back, trades above 1.0860
EUR/USD bounced from a fresh weekly low of 1.0827, as the US Dollar lost steam following a weak ISM Manufacturing PMI report and words from Federal Reserve Chair Jerome Powell. Powell reiterated its hawkish message, dismissing potential rate cuts in the near future.
GBP/USD turns north ahead of the weekly close, approaches 1.2700
GBP/USD extended its rebound from near 1.2600 and is approaching 1.2700 on the back of a weaker US Dollar. The Greenback accelerated to the downside following comments from Fed’s Powell.
Gold resumes advance and approaches record highs
Gold remains near record highs and achieved its highest monthly close ever in November. Global bond yields continue to decline as inflation further cools, supporting the upside in XAU/USD. With central banks expected to remain on hold, the focus will be US labor market data.
Solana likely to extend gains as DeFi airdrop season could boost user base
Solana ecosystem will see airdrops from projects like Jupiter, Marginfi, Drift, Zeta and Jito. Solana users are projected to increase between 30% and 80% from native token launches, according to Messari’s latest report. SOL price extends rally, yielding nearly 4% daily gains.
Tesla Stock News: Cybertruck excitement fails to sustain TSLA price as chart signals more downside
TSLA stock sinks three days in a row despite Cybertruck unveiling. Analysts conclude that Cybertruck will find it difficult to turn a profit. TSLA stock is the midst of forming a bearish Three Black Crows pattern on the daily chart.