WTI crude oil is still trending higher inside its rising channel on the 4-hour time frame and is currently pulling back to the mid-channel area of interest. This happens to line up with the 38.2% Fibonacci retracement level.

If buyers defend this support area, crude oil could recover to the swing high at $66.72 per barrel or the top of the channel closer to $67 per barrel from here. A larger pullback, on the other hand, could see a dip to the 50% level at $63.68 per barrel or the 61.8% Fib that’s closer to the channel support.

The 100 SMA is above the 200 SMA to confirm that the path of least resistance is to the upside or that the climb is more likely to gain traction than to reverse. The gap between the indicators is widening to reflect strengthening bullish momentum, and the 100 SMA is near the 50% Fib to add to its strength as support.

Stochastic is turning higher to indicate the presence of bullish pressure, and the oscillator has plenty of room to climb before reflecting overbought conditions or exhaustion among buyers. A break past the channel top could set off an even steeper rally.

WTI crude oil saw a much larger than expected draw of 8 million barrels in stockpiles based on the EIA report, and another reduction this time could mean more gains for the commodity.

Keep in mind that the reopening of several economies likely drove up business demand, which then lifted purchases of fuel and energy commodities. This could carry on as vaccination efforts continue to progress, and more consumer activity is observed.

In addition, overall market sentiment would also likely push commodities around this week, but it’s worth noting that US reports could reflect a slowdown in April numbers.