Corona Virus
Stay Safe, FollowGuidance
Fetching Location Data…
James Hyerczyk
WTI Brent Crude Oil

U.S. West Texas Intermediate crude oil futures finished slightly higher on Tuesday ahead of tomorrow’s weekly U.S. inventory figures, rebounding modestly from the previous day’s steep break that was driven by a surge in overseas coronavirus infections. The market was helped by a private industry report that showed a large gasoline draw despite an unexpected crude inventory build.

On Tuesday, December WTI crude oil settled at $40.09, up $0.24 or 0.60%.

Late Tuesday, the American Petroleum Institute (API) reported a build in crude oil inventories of 691,000 barrels for the week-ending September 18. Analysts were looking for an inventory draw of 2.256-million barrels.

The API also reported a draw in gasoline inventories of 7.735 million barrels of gasoline for the week-ending September 11 – compared to last week’s 3.762-million-barrel build. Analysts had expected a much smaller 614,000-barrel draw for the week.

Distillate inventories were down by 2.104 million barrels for the week, compared to last week’s 1.123-million-barrel draw, while Cushing inventory rose by 298,000 barrels.

Daily December WTI Crude Oil

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum is trending a little higher. A trade through $37.11 will signal a resumption of the downtrend. The main trend will change to up when buyers take out $44.33.

The minor trend is also down. A trade through $42.02 will change the minor trend to up. This move will confirm the shift in momentum to up.

The short-term range is $44.33 to $37.11. Its retracement zone at $40.72 to $41.57 is potential resistance.

The minor range is $37.11 to $42.02. Its retracement zone at $39.57 to $38.99 is support. It stopped the selling at $39.21 on Monday.


Short-Term Outlook

Holding between the two retracement zones will produce a rangebound trade. On the upside, the trigger point for an acceleration is the Fibonacci level at $41.57. Taking out the Fibonacci level at $38.99 could trigger an acceleration to the downside. The daily chart indicates there is plenty of room to the downside with the next major target the September 9 main bottom at $37.11.

Why is a rangebound trade possible? Because some traders believe renewed lockdown restrictions in Europe will have only a limited impact on fuel demand, which could prevent a pronounced selloff in oil markets. Additionally, with major oil-producing nations still restricting supply, the market has been locked in a range for most of the summer. This time, it is likely to be at lower prices.

For a look at all of today’s economic events, check out our economic calendar.
Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Trade With A Regulated Broker

  • Your capital is at risk
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.