WTI Crude Oil Price Analysis for Oct. 27, 2021

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WTI crude oil found support at the area of interest or former resistance at the $82.85 per barrel mark. Price is now setting its sights on upside targets marked by the Fibonacci extension tool.

The 38.2% level appears to be holding as resistance around $84.75 per barrel, but stronger bullish pressure could still take it up to the next upside barrier at the 50% extension or $85.30 per barrel.

Sustained bullish momentum could lead to a rally up to the 61.8% Fib at $85.85 per barrel or the 76.4% level at $86.57 per barrel. The full extension is at $87.71 per barrel.

The 100 SMA is above the 200 SMA to indicate that the path of least resistance is to the upside or that support is more likely to hold than to break. However, the gap between the indicators is slowly narrowing to reflect slowing bullish momentum.

Stochastic is also heading lower after reaching the overbought area, confirming a return in bearish pressure. The oscillator has some room to slide before indicating oversold conditions, so sellers could stay in play for much longer. RSI is also pointing down to show that sellers are in control.

Crude oil could take cues from the release of the EIA inventory numbers later today. A build of 2 million barrels is eyed, following the earlier surprise draw of 0.4 million barrels. However, another reduction could spur a large rally since it would mark another week of strong demand or weak supply.

Keep in mind that weather disruptions are still keeping production levels in check while purchases continue to advance as more businesses resume normal operations while economies emerge from lockdowns. This energy crunch is in play all over the globe and might be enough to sustain more gains for fuel commodities like crude oil in the near term.

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