WTI oil bounced to $66.98 on Wednesday after long-legged Doji on Tuesday signaled indecision.
Bears cracked key near-term support at $65.73 (23 Oct low) but failed to sustain break, showing nervousness ahead of start of US sanctions on Iran next week.
Lower than expected build in US crude stocks (API report on Tuesday showed build of 5.7 mln bls vs last week’s 9.88 mln bls build) added to reduction of negative momentum. The price may hold in extended consolidation before continuing towards targets at $64.66/43 (weekly cloud top/16 Aug low) , as overall bears remain intact are reinforced by formation of 10/200SMA death-cross on daily chart.
EIA weekly crude stocks report is in focus today (4.11 mln bls build f/c vs 6.34 mln bls build previous week) and could boost recovery if crude inventories rise less than expected or possibly fall into negative territory.
Conversely, stronger than expected build would increase pressure on oil prices.
Res: 66.98, 67.50, 67.93, 68.58
Sup: 66.26, 65.73, 65.32, 64.66
