Crude Oil Price Update – Bearish EIA Report Could Trigger Break into $38.15 to $37.50

US West Texas Intermediate's crude oil futures are under pressure shortly before the release of a weekly government inventory report at 2:30 p.m. GMT. The report is expected to show a slight increase in crude oil stocks. However, the focus for traders is likely to be on gasoline and distillate numbers, as these correlate strongly with the reopening of the economy.
At 2:07 PM GMT, WTI crude traded at $ 39.51 in August, a decrease of $ 0.86 or -2.13%.
The US Energy Information Administration (EIA) report is expected to show a construction of 1.2 million barrels.
An increasing number of coronavirus cases in the USA, China, Latin America and India are shaking investors. Storage rooms around the world are almost full, and according to analysts, if a second wave of the pandemic hits demand, they will have difficulty coping with the unused oil.
Late Tuesday, the American Petroleum Institute (API) reported a sharp rise in U.S. crude stocks than expected, but gasoline and distillate stocks declined, suggesting consumption picked up again due to the easing of closures.
Daily August WTI crude oil
Daily swing chart technical analysis
The main trend has risen, according to the daily swing chart. However, the dynamic tends to be lower. The momentum shifted earlier on Tuesday with the closing reversal peak and subsequent confirmation today.
Trading above $ 41.63 will negate the upside reversal and signal a resumption of the uptrend. The main trend will change if the move moves down $ 34.66.
The small trend has also risen. A trade above $ 37.40 will change the small trend down. This confirms the shift of the pulse downwards.
The main range is between $ 54.71 and $ 20.28. The $ 37.50 to $ 41.56 retracement zone controls the longer-term direction of the market. Crude oil is currently traded in this zone.
The short-term range is between $ 34.66 and $ 41.63. The 50% level at $ 38.15 is another potential downside target.
Daily swing chart technical forecast
The closing price reversal peak at $ 41.63 has pushed the momentum down. If today's EIA report is bearish, make sure that sales continue to be between $ 38.15 and $ 37.50.
A bullish EIA report could trigger a short covering rally, with the first target at $ 40.46 and the resistance cluster at $ 41.56 to $ 41.63. Taking out $ 41.63 could trigger an upward acceleration.
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This article was originally published on FX Empire
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