WTI crude oil is starting to trend higher once more, but is still in the middle of a pullback on its rising channel. Price just bounced off the top and could make a correction to the bottom around $65.50 per barrel.
However, price already seems to have bounced off the 61.8% Fibonacci retracement level at $65.54 per barrel and might be setting its sights back on the swing high or channel top. The moving averages also held as dynamic support levels.
Speaking of moving averages, the 100 SMA crossed above the longer-term 200 SMA to signal that bullish momentum is returning. In other words, the uptrend is more likely to carry on than to reverse. Price could make its way up to $66.67 per barrel or the $67 per barrel level next.
RSI is also pulling up so WTI crude oil price might follow from here. The oscillator didn’t even reach oversold levels, which suggests that buyers are eager to jump back in. Similarly, stochastic is moving up to show that bulls are charging again.
The American Petroleum Institute actually reported a slight draw of 730,000 barrels of United States crude oil inventories for the week ending June 8 versus the estimated reduction of 2.7 million barrels. The numbers from the Energy Information Administration are due next and a surprise build or another smaller draw could put more downside pressure on crude oil.
The OPEC once again hinted at potential adjustments to its output deal to account for lower production in Iran and Venezuela. Recall that the cartel has agreed to keep a cap on output until the end of the year, although it could still adjust limits or relax compliance requirements.
With that, crude oil could tread carefully leading up to the actual summit on June 22 in Vienna but might still be reactive to chatter from OPEC sources.