WTI OIL – pullback found footstep ahead of $66 support but further easing cannot be ruled out
Pullback from new over three-year high at $67.74 found temporary footstep just ahead of $66.00 round-figure support and consolidating on Tuesday after suffering heavy losses previous day.
Near-term focus is still shifted to the downside as Monday’s long bearish daily candle weighs, as reversal pattern was completed on daily chart, signaling further easing.
The notion is supported by south-heading slow stochastic which reversed from overbought zone and shows a plenty of space at the downside.
However, the pullback was triggered by profit-taking and so far seen as positioning for fresh upside action as bulls focus psychological $70 barrier.
Solid supports at $65.47 (Fibo 38.2% of $61.80/$67.74 rally) and $65.18 (rising 10SMA) should ideally contain extend dips to keep overall bulls intact.
Easing geopolitical tensions in the Middle East are also supportive for oil price.
Near-term focus turns towards releases of US crude stocks reports, as traders are looking to gauge the demand in the world’s largest oil consumer. API report is due today (build of 1.75 million barrels was seen last week) while EIA report will be released tomorrow (0.5 million barrels draw is forecasted vs 1.04 million barrels draw last week).
Res: 66.73; 67.00; 67.74; 68.63
Sup: 66.00; 65.47; 65.18; 64.85