Technical Analysis Crude Oil for 8/19/15

Crude oil prices rebounded by nearly 75 cents on Tuesday rebounding after testing Friday’s lows at $41.70.  A stronger than expected housing starts helped prices rebound.  Inventories continued to slice according to the American Petroleum Institute. The API reports a 2.3 million barrel inventory draw, larger than expected, extending the run to 4 consecutive weeks of drawdowns.

Momentum remains negative, with the MACD (moving average convergence divergence) printing in the red with a downward sloping trajectory. Support are the recent lows at $41.35 while resistance is seen near the 20-day moving average at $45.55. 

U.S. housing starts edged up 0.2% in July to a 1,206k pace, the best since October 2007, after rebounding 12.3% to 1,204k in June. But, building permits fell 16.3% to 1,119k, from a revised 7.0% June gain to 1,337k. Single family starts rose 12.8% on the month, with multifamily down 17.0%.