Oil price climbs higher today during the Asian session as U.S. inventories fall. Oil bulls are active below $27.50 area, can WTI price strike higher towards $36 in the process? What are the charts and technical indicators are saying? Read more to find further insights into today’s WTI Technical Analysis.
May 14, 2020 | AtoZ Markets – Oil is currently trading around $26.20 area and trying to push higher. The price found support at the Bollinger Bands middle band on the intraday chart, which is the 20-period simple moving average. As per the current scenario, Oil bulls are quite active below $27.50 area may strike higher in the coming days.
Oil Bull Active as the U.S. Inventories Surprisingly Fall
WTI price slight up today as the U.S. crude inventories decline. But the gains were not so impressive as investors are worried about the second wave of Coronavirus pandemic upcoming lockdowns. The second wave may slam fuel demand once again. Moreover, Brent crude futures up by 0.2%, or 6 cents, to $29.25 per barrel, and West Texas Intermediate (WTI) crude futures rose by 0.3%, or 8 cents, to $25.37 a barrel.
Furthermore, the United States Crude stocks surged since January because the fuel demand around the world is falling. On the other hand, U.S. crude inventories down by 745,000 barrels to 531.5 million barrels in the first week of May, according to the Energy Information Administration Wednesday’s report.
Besides, Oil price has risen in the last two weeks as some countries are easing COVID-19 lockdown and restrictions. It adds some hope for a pickup in Oil demand. Along with, The Organization of Petroleum Exporting Countries (OPEC) and its allies also Russia agreed on further production cut by 9.7 million barrels per day (BPD) in May and June. In addition to this, Saudi Arabia also agreed on cut its production by 9.7 million barrels per day, which is starting in June.
WTI May Break Above $27.50 Event Level
According to the 4-hour chart, WTI is currently residing near $26.20 area and tying to recover higher. As per the current price action, if the price breaks above $27.50 area impulsively, the bulls may push the price higher towards $36 in the days ahead. Alternatively, if the price rejects $27.50 with a bearish candle close, the bears may regain momentum and decline towards $20 area in the coming days.
Image: Oil 4 Hour Chart
Furthermore, the Bollinger Bands are squeezing, which is a pre indication of an upcoming impulsive move. The price found support at the middle band. It indicates bulls are quite strong to sustain further. Besides, the MACD lines are currently residing above 0.00 level and may have a bullish intersection in the process.
To conclude, as many countries are easing the Coronavirus pandemic’s lockdowns, Oil price is trying to recover its recent drawdown. A daily impulsive breakout is required above $27.50 area to sustain the bullish pressure in the days ahead.