FXStreet (Mumbai) – WTI oil on NYMEX extends its upbeat momentum for the second straight session on Wednesday, recovering from a sharp drop to fresh multi-month lows reached on Friday, on expectations for drop in weekly crude stockpiles ahead of EIA report due later today.
WTI ignores broad USD strength
Currently, WTI trades 1.17% higher at 46.28, keeping upside supported above 46 levels. Oil prices extends further in to the green territory as traders wait for the fresh stockpiles report to see whether crude reserves in the US shrank last week.
Analysts at ANZ noted, “Participants will now await the weekly US inventory data announcement. Strong refining activity may drive down US crude oil stocks but lead to a build-up in finished product inventory.”
On Tuesday, the American Petroleum Institute (API) reported a bigger than expected drop in crude inventories in the US which fell by 2.4 million barrels to 459.7 million in the week to July 31, against 1.5 million barrels drop expected.
Moreover, positive sentiment on oil prices was partially boosted by the fresh services PMI from China that rose to 53.8 points in July, growing at the fastest pace since August last year, following 51.8 in June.
Looking ahead, markets are waiting for US ADP employment data for further cues on the US dollar moves, which will eventually impact the black gold prices.
WTI Oil Technical Levels
WTI oil has an immediate resistance which stands at 46.94 levels above which gains could be extended to 48.44 levels. Meanwhile, support is seen at 45.08 levels from here losses could be extended to 44 levels.
(Market News Provided by FXstreet)