Crude Oil Price Update – Testing 13-Week High on Rising US Gasoline Demand

Crude oil prices are trading sharply higher late in the session on Wednesday amid a jump in gasoline demand. Traders are also increasing bets on China’s oil demand and on growing supply worries in several countries. A mixed government inventories report failed to slow down the buying as well as a dire outlook for the global economy from the World Bank.

At 18:27 GMT, July WTI crude oil futures are trading $122.40, up $2.99 or +2.50%. The United States Oil Fund is at $91.46, up $1.42 or +1.58%.

Bullish Traders Shrug Off Mixed EIA Report

The U.S. Energy Information Administration (EIA) on Wednesday reported that U.S. commercial crude oil inventories rose unexpectedly the week-ending June 3.

Meanwhile, U.S. gasoline stocks fell by a surprise 0.8 million barrels as demand for the fuel rose despite sky-high pump prices. Analysts polled by Reuters had expected gasoline stocks to rise 1.1 million barrels.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through the intraday high at $123.18 will signal a resumption of the uptrend. A move through $103.24 will change the main trend to down.

The minor trend is up. A trade through $117.14 will change the main trend to down. This will shift momentum to the downside.

The nearest support is a pivot at $120.16. This is followed by additional support at $117.19 and $115.90.

Daily Swing Chart Technical Forecast

Trader reaction to $119.41 will determine the direction of the July WTI crude oil market into the close on Wednesday.

Bullish Scenario

A sustained move over $119.41 will indicate the presence of buyers. Taking out $123.18 will indicate the buying is getting stronger with $126.42 the next target.

Bearish Scenario

A sustained move under $119.41 will signal the presence of sellers. If this creates enough downside momentum then look for the selling to possibly extend into the pivot at $120.16, followed by the support cluster at $117.19 – $117.14.