Brent and WTI spot contracts both climbed some two percent overnight despite an underwhelming crude inventory drawdown. Inventories fell by less than expected 1.5 million barrels, but oil was bailed out by the gasoline number, where stocks feel by a surprisingly large 2.5 million barrels.
From a technical perspective, the price action can be regarded as reasonably positive. Brent spot, in particular, held its 100-day moving average and its 50% retracement levels with WTI’s 50% retracement holding the sell-off precisely.
Both contracts appear to be moving into a range consolidation mode now with Brent spot needing to break a triple top at 52.70 to get traders of the fence again. It’s must hold support zone is 50.50/50.70 area where the aforementioned 100-day average and 50% retracement levels lie.
WTI spot sits midrange at 49.35 with resistance at 50.30, a double top. Must hold support comes in at the 50% retracement at 48.20 and then its 100-day average at 47.75.