Crude Oil Price Update – Straddling $72.49 Pivot Ahead of EIA Report

U.S. West Texas Intermediate crude oil futures are trading slightly lower while remaining inside yesterday’s range. This chart pattern typically indicates investor indecision and impending volatility. New COVID-19 fears and general uncertainty ahead of the July 1 OPEC+ meeting are helping to slow down the upside momentum, while keeping some traders on the sidelines.

Prices are being underpinned by an industry report that showed U.S. crude stockpiles fell last week. Helping to put a lid on prices, however, are concerns over the spread of the highly contagious Delta variant and its potential impact on transportation-related demand in some countries.

At 09:10 GMT, September WTI crude oil futures are trading $72.68, up $0.37 or +0.51%.

Late Tuesday, the American Petroleum Institute (API) reported crude stocks in the Unites States were down by 8.2 million barrels. However, gasoline inventories rose by 2.4 million barrels and distillate stocks were up by 428,000 barrels.

Today at 14:30 GMT, the Energy Information Administration (EIA) is expected to report a weekly decline of 4.2 million barrels of crude oil.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since the formation of the closing price reversal top on June 28.

A trade through $73.70 will negate the closing price reversal top and signal a resumption of the uptrend. A move through $61.06 will change the main trend to down.

The minor trend is down. This move confirms the shift in momentum. Taking out yesterday’s low at $71.28 will indicate the selling pressure is increasing.

The minor range is $73.70 to $71.28. The market is currently trading on the strong side of its pivot at $72.49.

On the downside, the first two support levels come in at $71.28 and $70.77. The latter is a potential trigger point for an acceleration into a 50% level at $69.15.

Daily Swing Chart Technical Forecast

The direction of the September WTI crude oil market on Wednesday is likely to be determined by trader reaction to $72.49.

Bullish Scenario

A sustained move over $72.49 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to possibly extend into $73.70. This is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under $72.49 will signal the presence of sellers. This could trigger a break into the pair of 50% levels at $71.28 and $70.77. Taking out $70.77 could trigger an acceleration into $69.15.