WTI crude oil is trading inside a descending channel on its short-term chart, and it looks like a pullback to the resistance is underway. If it holds, another dip to support around $67.50 per barrel could follow.

The 100 SMA is above the 200 SMA, though, so the path of least resistance is to the upside. In other words, there’s a possibility that resistance might break.

Price is trading below both moving averages, however, so bearish pressure might just be picking up. In addition, the gap between the indicators is narrowing to reflect weakening bullish momentum and a potential crossover.

Resistance around the 50% Fib at the $68.50 per barrel mark is holding, and a larger correction could still hit a ceiling at the 61.8% level. The $69 per barrel level around the 100 SMA dynamic inflection point might be the line in the sand for a pullback.

Stochastic is still heading up to show that buyers still have some energy left for a larger pullback before letting sellers take over. RSI has more room to climb, so the rally could keep going for much longer.

Crude oil would likely take cues from the API and EIA reports this week, with the latter slated to show another decline in stockpiles. This comes after the weather disturbances led to shut-ins among facilities in the Gulf Coast.

However, weaker demand on account of concerns about the Delta variant spread might contribute to a build in inventories. After all, business and consumer activity likely slowed due to restrictions.

The commodity is still drawing support from news that China increased its oil consumption, counteracting the OPEC increase in production since last month. Whether or not this can be sustained, however, might be indicative of where crude oil is headed in the long run.