Crude Oil Price Update – Prices Rise After EIA Reports Inventory Draw, Offsetting Bearish API Report
U.S. West Texas Intermediate crude oil futures are trading lower shortly after the regular session opening and before the release of the U.S. Energy Information Administration (EIA) weekly inventory report at 15:30 GMT. The report is likely to trigger a volatile response.
The early selling pressure is being fueled by yesterday’s unexpected inventories build as reported by the American Petroleum Institute (API). Helping to limit losses are hopes of increased demand growth now that the U.S. and China have reached a partial trade deal.
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At 15:23 GMT, February WTI crude oil is trading $60.39, down $0.48 or -0.80%.
Traders are looking for today’s EIA report to show a 1.5 million barrel draw. Look for prices to surge if the report meets or exceeds expectations. Prices could plunge further if the build is bigger than the API number.
Daily Technical Analysis
The main trend is up according to the daily swing chart. A trade through $60.97 will signal a resumption of the uptrend. The main trend will change to down on a move through $54.75. This is highly unlikely, however, traders should watch for a closing price reversal top.
The minor trend is also up. A move through $57.62 will change the minor trend to down. This will shift momentum to the downside.
The nearest support is a Fibonacci level at $58.66 and a 50% level at $57.06.
Daily Technical Forecast
The EIA report is likely to generate a volatile response.
A bullish response could drive the market into a downtrending Gann angle at $61.24. Taking out this angle could trigger an acceleration to the upside with the next target angle $62.55.
A bearish report could trigger a break into the uptrending Gann angle at $59.50. Watch for a technical bounce on the first test of this level.