Oil price eases in early Wednesday’s trading, in reaction on unexpected build in crude stocks. API report, released in late Tuesday, showed crude stocks rose nearly 0.6 million barrels previous week, against expectations for 0.4 million barrels draw.
The pullback from Tuesday’s high at $52.59, the highest in one month, could be seen as consolidation ahead of fresh upside and eventual break above key $52.84 barrier (28 Sep high).
Techs remain firmly bullish and supportive for further advance, as oil prices were recently driven by strong bullish sentiment on strong signs of oil market rebalancing and comments from Saudi Arabia on Tuesday, which showed readiness to extend current production cut plan.
Yesterday’s rally and eventual close above one-week congestion tops was bullish signal, with traders positioning for today’s EIA crude inventories report. US crude stocks and are expected to reduce by 2.5 million barrels in the previous week, which would be supportive for oil prices.
Otherwise, stronger pullback could be anticipated if report shows build in crude inventories.
Support at $52.00 stays intact for now, guarding more significant $51.64 support (rising Tenkan-sen).
Res: 52.59, 52.84, 53.73, 54.27
Sup: 51.96, 51.64, 51.17, 50.86
