WTI Price Analysis: Bullish reversal looks likely above $75
- The oil price faces some sell-off near $75.00 ahead of US economic data.
- US weekly crude oil inventories were surprisingly rose by 2.9 million barrels for the week ending Dec 15.
- WTI recovered swiftly after a bullish divergence formation.
West Texas Intermediate (WTI), futures on NYMEX, falls back after failing to climb above the immediate resistance of $75.00. The broader appeal for the oil price is upbeat as Federal Reserve (Fed) policymakers are expected to unwind their tight interest rate stance sooner.
In addition to deepening Fed rate cut expectations, trade issues near the Red sea are expected to keep oil supply limited.
The oil price continues to find bids despite a surprise jump in crude oil inventories by 2.9 million barrels for the week ending December 15. On the contrary, investors projected a drawdown in oil stockpiles by 2.3 million barrels.
WTI has recovered strongly after discovering buying interest near $68.00 post a bullish divergence formation. While oil prices were consistently forming lower highs lower lows the Relative Strength Index (RSI) (14) formed a higher low, demonstrated an end to the downside momentum.
The asset is confidently sustaining above the 50-period Exponential Moving Average (EMA), which indicates that the near-term trend has turned bullish.
The oil price may fetch significant bids after a decisive break above Wednesday’s high of $75.00, which will drive the asset towards November 30 high around $79.63, followed by November 6 high near $82.00.
In an alternate scenario, a breakdown below December 13 low at $68.00 would expose the asset to eight-month low near $66.88, which is March 24 low. Further breakdown would drag the asset to May’s low near $64.30.
WTI two-hour chart
