WTI crude oil continues to cruise higher inside a shallow rising channel visible on its 4-hour time frame. Price just busted through the mid-channel area of interest and might be aiming for the resistance.

This lines up with the $71 per barrel and recent highs. A move past this resistance could set off a steeper climb for the commodity. Technical indicators, however, are showing signs of bullish exhaustion.

The 100 SMA is below the 200 SMA for now, so the path of least resistance is to the downside. However, the moving averages appear to be attempting a bullish crossover, and crude oil is already trading above both indicators.

Stochastic is in the overbought zone to reflect exhaustion among buyers, so turning lower would mean that sellers are taking over. RSI is on the move up, so there may be some bullish pressure left, but the oscillator is also closing in on the overbought zone.

WTI crude oil is opening higher this week, as traders are concerned about falling supply levels in the US. Recall that Hurricane Ida led to a disruption in production activity along the Gulf Coast in the past week, so output was likely significantly lower.

The upcoming inventory reports from the API and EIA might show reduction in stockpiles, especially if demand stayed supported throughout the previous week. Although global supply is elevated due to the OPEC production increase, reports that China increased its purchases and reserves is keeping demand forecasts afloat.

The US CPI release might also indirectly impact commodity price action since this might impact speculations on when the Fed could start tapering stimulus. Strong data could support October taper hopes while downbeat results could lead traders to price in a reduction by November or December.