Crude Oil Daily Technical Outlook

Weekly inventory data from both industry-sponsored American Petroleum Institute (API) and US Energy Department (EIA) have consistently disappointed the market on product inventory builds. Gasoline stockpiles have risen for 3 consecutive weeks by a total of 9.59 mmb, according to EIA. For distillate, the increase in inventory has been as worrisome as usual. Although crude stockpile has plunged for 4 straight months, reduction in refining margins is expected to curb crude demand and may cause inventory to build up again later.













Written by Oil N' Gold
Nymex Crude Oil (CL)

Crude oil turns sideway after falling to 63.40 but still, intraday bias remains on the downside with 65.42 minor resistance intact. Further fall is expected to 38.2% retracement of 43.83 to 73.38 at 62.09 next. Break will then target key resistance turned support at 54.66. On the upside, above 65.42 will indicate that an intraday low is in place and bring recovery, probably to retest double top neckline at 66.25 or above. But upside should be limited well below 73.38 and bring fall resumption.

In the bigger picture, the case of reversal continues to build up with daily MACD staying below signal line and last week's doubt top reversal pattern (73.23, 73.38). Focus will now turn to channel support at 58.80. Sustained break there will indicate that whole rise from 33.2 has completed at 73.83, ahead of 38.2% retracement of 147.27 to 33.2 at 76.77. The three wave structure of the rise from 33.2 to 73.83 will in turn indicate that it's part of wide range consolidation only and hence, will open up the bearish case for a retest of 33.2 low. On the upside, break of 73.83 is now needed to confirm that rise from 33.2 is still in progress. Otherwise, risks remain on the downside.