Oil Plunges to 2-Month Low After Inventory Report
FXOpen
West Texas Intermediate (WTI) fell broadly yesterday, dragging the price of Crude Oil to less than $46.00 a barrel following the release of the US crude oil inventory report. The technical bias has turned bearish because of a Lower Low in the ongoing downside wave.
Technical Analysis
As of this writing, crude oil is being traded near $45.93. A hurdle may be noted around $46.38, a major horizontal resistance area ahead of $48.20, another major horizontal resistance and then $50, the psychological number as demonstrated in the following daily chart.
On the downside, the price of WTI is likely to find a support around $45.32, the intraday low of yesterday ahead of $43.49, the swing low of April 10th and then $40, the psychological number. The technical bias will remain bearish as long as the $50 resistance area is intact.
US Crude Oil Inventory
The Energy Information Administration (EIA) said crude stockpiles fell 2.2 million barrels for the week to July 1, just below a 2.3-million barrel decline forecast by analysts in a Reuters poll. While the EIA reported a seventh weekly decline in crude stocks, the figure it gave was far less than a 6.7 million-barrel draw cited by trade group the American Petroleum Institute in preliminary data issued late Wednesday.
Trade Idea
Considering the overall technical and fundamental outlook, buying crude oil on dips when we get a bullish reversal candle on a four-hour or daily timeframe still appears to be a good strategy in short to medium term.
Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips (additional fees may apply). Open your FXOpen account now or learn more about trading forex with FXOpen.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Stay ahead of the market!
Subscribe now to our mailing list and receive the latest market news and insights delivered directly to your inbox.
Latest articles
DAX 40: consolidation amid technology sell-off
A wave of selling in the technology sector that emerged earlier this week has weighed on European equities. The trigger was investor concern over the profitability of large-scale debt-funded investments by major US tech companies in AI infrastructure. The Nasdaq
Euro Hits Fresh Yearly Lows Amid Dovish ECB Signals
The euro remains under pressure following weak macroeconomic data from the euro area and fresh signals that the European Central Bank is prepared to maintain a more accommodative monetary policy stance. Data released yesterday pointed to a deterioration in business
Pound at Key Levels: Markets Assess Impact of Political Uncertainty in the UK
The British pound remains under pressure following increased political uncertainty in the United Kingdom triggered by the Prime Minister’s resignation. Investors are assessing potential shifts in the political and economic policy outlook after the head of government stepped down,