FXStreet (Mumbai) – WTI oil on NYMEX resumed its bearish momentum on Wednesday, reversing a brief rebound seen in the previous session, as traders remain nervous ahead of key U inflation figures and EIA weekly crude stockpiles report.
WTI – downtrend resumes
Currently, WTI trades -0.80% lower at 42.77, having faced rejection at $ 43. Oil prices fell on Wednesday ahead of the US inventory report that will say more about demand in the world’s no. 1 economy.
The American Petroleum Institute (API) showed late on Tuesday that US crude stockpiles dropped by 600,000 barrels for the week to August 14.
The Energy Information Administration (EIA) will report its data later in the day, with markets predicting a fall of 820,000 barrels, which would be a fourth consecutive weekly drop.
Besides, US dollar moves will be also eyed as the currency impacts the price of dollar-denominated assets such as oil. The upcoming report on US inflation and the release of the Federal Reserve meeting minutes for July will dictate the greenback’s direction later in the day. The US dollar index now drops -0.14% to 96.84.
Analysts at ANZ noted, “Any recovery in WTI prices from a six-year low may be short-lived with the US entering the slow demand period in September.”
Furthermore, a stock rout in China is also weighing negatively on oil prices, with the Shanghai Composite index falling about 3% on Wednesday after an over 6% slump the session before.
WTI Oil Technical Levels
WTI oil has an immediate resistance which stands at 43 levels above which gains could be extended to 44.24 levels. Meanwhile, support is seen at 41.46 levels from here losses could be extended to 39 levels.
(Market News Provided by FXstreet)