West Texas Intermediate (WTI), the benchmark for New York-traded crude oil prices, rebounds more than +4% Wednesday, extending gains from the previous session as improved risk appetite provided support despite data showing an unexpected rise in U.S. oil inventories.
(WTI) recovery from this week’s severe downturn now questions the given downside target of $62.00 a barrel.
On Monday, the steep fall covered more than -7% losses and one of the biggest daily declines of this year, which was triggered by concerns about the spread of the COVID delta variant, which could threaten the outlook for oil demand.
On Wednesday, the Energy Information Administration reported an unexpected weekly rise in U.S. crude supplies and revealed that stocks at the Cushing, Okla., storage hub fell to their lowest since January 2020.
From a technical perspective, many may now be viewing the rebound can exceed further.
That said, a clearance/close above the $71.10-25 would expect to give further coverage and exposure to the region of $74.40-80 a barrel.
The Relative Strength Index (RSI) 3-daily ‘lookback’ indicator now wobbles above the 50-midway point (mixed-signal), while the Moving Average Convergence Divergence (MACD) supports a negative bias.
The Average Directional Movement Index (ADX) trend indicator decline suggests the presence of a trading market and the absence of a trend.