US oil is consolidating under fresh one-month low at $45.63 posted after sharp fall on surprise oil stocks build.
Report from Energy Information Administration released on Wednesday showed crude inventories rose by 3.3 million barrels, compared to forecasted draw of 3.5 million barrels.
Oil price was down 4.6% on Wednesday, marking the second big daily loss in two weeks and extending steep descend from $51.98 peak (25 May high).
US crude oil remains under strong pressure and was mainly unaffected by recent rising geopolitical tensions in the Middle East, with recent OPEC decision to extend production cut, giving no results, as rising fears on global oversupply continue to drive oil price lower.
Wednesday’s fall met target at $45.68 (Fibo 76.4% of $43.74/$51.98 rally) where temporary footstep was found. The price may correct higher on oversold daily studies (no firmer bullish signal being generated so far) but strong bearish sentiment suggests limited upside action before bears resume.
Broken weekly cloud top at $46.54 and broken Fibo 61.8% of $43.74/$51.98 at $46.89 mark solid barriers, which should ideally cap, with extended upticks expected to hold below broken daily Kijun-sen at $47.86.
Firm break below $45.68 handle would open way towards key support at $43.74 (05 May spike low).
Only firm break above pivots at $48.00/40 (Fibo 38.2% of $51.98/$45.63 fall / 05/06 June upside rejections) would sideline immediate bearish threats and signal stronger correction.
Res: 46.54, 46.89, 47.13, 48.00
Sup: 45.68, 45.28, 44.81, 43.74