WTI crude oil is in correction mode on the daily time frame but the uptrend remains intact. Price is pulling back to the 38.2% level that might keep losses in check at $71 per barrel.

A larger correction could reach the 50% level near a rising trend line support that’s been holding since the start of this year. The 61.8% fib is just slightly below this level at $67.50 per barrel.

The 100 SMA is above the 200 SMA to confirm that the path of least resistance is to the upside or that support is more likely to hold than to break. If any of the Fibs hold as support, crude oil could recover to the swing high around $77 per barrel or higher.

Stochastic is still on the move down to show that sellers have the upper hand, but the oscillator is also closing in on the oversold region to signal potential exhaustion. RSI has more room to head south, so price could keep following suit as bearish pressure remains in play.

Keep in mind, though, that the FOMC minutes spurred risk aversion in the past trading sessions since it revealed that more policymakers are open to the idea of tapering stimulus soon.

This could mean that the Fed is moving closer to hiking interest rates, which would then mean higher borrowing costs for businesses and consumers. In turn, this could keep a lid on investing and spending activity, which then weighs on demand for fuel and energy commodities.

The upcoming crude oil inventories report from the Energy Information Administration is slated to show a draw of 4 million barrels, lower than the earlier reduction of 6.7 million barrels. A larger reduction could signal that demand remains supported, even as businesses and consumers are concerned about the Delta variant spread.