WTI crude oil is still within its ascending channel and appears to be bouncing off support. This lines up with the 100 SMA dynamic inflection point and the 50% Fibonacci retracement level. A larger pullback could last until the 61.8% Fib or the 200 SMA dynamic support.

The 100 SMA is above the longer-term 200 SMA so the path of least resistance is still to the upside. In other words, the uptrend is more likely to resume than to reverse. The gap is also widening to reflect stronger bullish momentum.

Stochastic is also turning higher to reflect a pickup in bullish pressure. RSI is also heading higher so WTI crude oil might follow suit.

Risk aversion dampened commodity prices last week as speculations of a full-out nuclear war drove traders away from higher-yielding assets. However, WTI crude oil drew some support from an IEA report confirming that stronger demand may be enough to rebalance the market and keep prices afloat.

Also, the latest batch of inventory reports reflected lower supply levels, which is also positive for price levels. Traders could continue to keep close tabs on stockpiles from the American Petroleum Institute and the Energy Information Administration to gauge if a global glut is still a concern.

More importantly, market sentiment could continue to push risky assets around in the coming days so traders are likely to keep close tabs on headlines regarding North Korea. For now, however, the Trump administration has been diverted by the incident in Charlottesville.

US CPI has turned out weaker than expected for July so there are lower expectations for a Fed hike next month, something that is also positive for commodities. The attention turns to the US retail sales report this week but this might generate a weaker impact on oil and the dollar compared to the FOMC minutes.