WTI crude shot higher after the EIA reported a large drop in US inventories.
A bullish MA cross on the daily chart suggests that sentiment has turned positive. After a brief consolidation, price action has lifted the psychological level of 70.00, turning it into fresh support.
As the upward momentum picks up speed, the oil price is heading to 74.10. The quick recovery would put the August sell-off behind and resume the 17-month long rally. A limited retracement may occur as the RSI inches into the overbought area.
