WTI crude oil is still moving inside its ascending channel formation visible on the 4-hour time frame but price might need to make a deeper correction to support.

Applying the Fibonacci retracement tool on the latest swing low and high on the 4-hour time frame shows that the 61.8% level lines up with the channel support around $47.50 per barrel, which is also a former resistance zone. If this holds as support, crude oil could make its way back to the swing high at $50.45 per barrel or up to the channel resistance around $52 per barrel.

The 100 SMA is above the longer-term 200 SMA so the path of least resistance is to the upside. Also the gap between the moving averages is pretty steady so bullish momentum could stay in play. The 100 SMA is also in line with the channel support, adding to its strength as a floor. A break below the 200 SMA could signal that a downtrend is in order.

Stochastic is on the move up to indicate the presence of bullish pressure. However, this oscillator is already nearing overbought conditions to signal rally exhaustion. RSI is heading lower so WTI crude oil might follow suit.

The OPEC meeting is set to take place on August 7-8 and market participants are hoping to see stronger resolve from the cartel to keep crude oil prices supported. Compliance has been falling based on the latest reports while output continues to trickle higher, so Saudi Arabia is widely expected to push for better cooperation. There have also been speculations that exemptions on Libya and Nigeria might need to be lifted but there has been no official confirmation.

Traders are also likely to keep close tabs on rig counts and inventory reports from the US as any buildup could revive oversupply concerns. Still, sanctions on Venezuela’s energy shipments could force the US to use up its own supply, which would contribute to easing the global supply glut as well.