Today in the early Asian session, the WTI crude oil prices rose, although the report of the American Petroleum Institute (API) said U.S. oil inventories increased last week.
The U.S. Crude Oil WTI Futures gained 1.0% to $51.12. The WTI Crude Oil prices started tp recover yesterday after reports said the OPEC+ representatives meeting in Vienna discussed additional cuts of up to 1.0 million barrels per day to cope with lost demand from China’s coronavirus crisis.
Despite the gains this week, WTI crude oil is still down more than 20% since early January because of the coronavirus depressed global demand. It is worth to mention that the issue for the market will likely be increased if the restriction continues for an extended period because due to this demand loss will become increasingly difficult for the market to swallow.
The API said in its weekly report that crude stockpiles rose by 4.2 million barrels for the week ended Jan. 31, compared with a draw of about 4.3 million barrels reported for the week before.
At the coronavirus front, over 490 people have died in China from the coronavirus infection, said officials on Wednesday. Also, the confirmed number of infected citizens grew to 24,324 from 20,438 confirmed cases the day before.
There are still plenty to be concerned for, and the price of oil is valid, sliding further overnight to a low of $49.41bbls. Chinese oil demand has already dropped by 20% because of dwindling air travel, road transportation, and manufacturing.
Daily Support and Resistance
- S3 45.79
- S2 48
- S1 48.77
Pivot Point 50.2
- R1 50.98
- R2 52.41
- R3 54.62
Technically, the WTI crude oil seems to violate the downward channel at 51.50, which may drive the WTI prices higher until 51.70. A bullish breakout of this level can lead oil prices further higher towards 52.25 today. The EMA and MACD are pointing into the bullish zone, suggesting the chances of a bullish trend continuation. Let’s consider taking buying trade above 51.25 today to aim for 52.25. All the best!