West Texas Intermediate (WTI), the benchmark for New York-traded crude oil prices, advanced through the key resistance level and closed above $64.80, which has now initiated the bullish call to $67.00-50, (which is now within in arm’s reach to the challenge).
Overnight gains were triggered after industry data estimated U.S. crude stockpiles fell much more than expected last week started the bullish momentum on fuel demand.
According to market news sources, API figures showed crude stocks fell by 7.7 million barrels in the week ended April 30.
That was more than triple the drawdown expected forecast.
Data from the U.S. Energy Information Administration is due out later Wednesday to see if official data shows such a large drawdown.
From a technical perspective, the daily set-up of the Relative Strength Index (RSI) 3-daily ‘lookback’ indicator remains positive since rebounding from the 50-midway point, while the Moving Average Convergence Divergence (MACD) is holding to a positive signal.
The Average Directional Movement Index (ADX) trend indicator has strengthened to hold a bullish signal.
Viewing the topside, the resistance is located at $67.00-50.
A NY close above could expose a potential target of $70.00 to $74.00 (broad target).
The support is located at $64.30-40. Reassess from there.