WTI extends weakness after short-lived spike, pressured by surprise build in US crude stocks
WTI oil price is down over $4 for the day after hitting new multi-month high at $65.43 overnight, in reaction on Iran’s attack at US forces in Iraq.
Subsequent quick pullback was triggered by calming situation on signs that further escalation of the conflict is for now unlikely.
Oil price maintained positive tone in the past five weeks and extended recovery from the higher base at $50.60/90 zone to the highest levels since late April 2019.
Easing in past two days was corrective and today’s fresh acceleration lower was sparked by surprise build in US crude stocks (EIA 1.1 mln bls build vs 3.5 mln bls draw f/c and previous week’s record 11.4 mln bls draw).
South-heading daily indicators support corrective action, with loss of important supports at $61.71 (10DMA) and $61.45 (Fibo 38.2% of $55.00/$65.43 upleg), generating fresh bearish signal which needs confirmation on daily close below these levels to expose next supports at $60.22 (50% retracement) and psychological $60 level.
Res: 61.45; 61.71; 62.06; 62.97
Sup: 60.84; 60.22; 60.00; 59.77