The futures contract rollover in WTI crude oil has been kind to bulls, driving prices to a proximity test of $60.00. During the U.S. overnight, May WTI crude rallied to a session high of $59.86. Sellers stepped in an defended the $60.00 handle with vigor. At press time, price has fallen more than $0.75 and is approaching the $59.00 level.

It is Tuesday and that means the weekly oil inventory cycle is getting ready to commence. This week’s figures are widely expected to extend the trend of shrinking supply. Here is a quick look at projections:

Event                                        Previous    Projected

API Crude Oil Stocks                -2.58M            NA

EIA Crude Oil Stocks                 -3.86M       -0.775M

Analysts are looking for supply to decrease, just not on the same level as in weeks past. Be on the lookout for a larger-than-expected drop in the EIA number and the API to post another negative figure.

WTI Crude Oil: Technical Outlook  

Today’s proximity test of the $60.00 handle was a welcomed sight for energy bulls. Even though the level was defended ferociously by heavy selling, this market appears poised to go higher.

Overview: For the intermediate-term, I will be carrying a bullish bias in the WTI crude market. The spring buying season is in full effect and $60.00 is likely only a speed bump on the way to $70 or $75 per barrel. Given OPEC production cuts, a relaxed FED, and positive U.S. economic fundamentals, the table is set for a two-month grind north for WTI.

Of course, getting on the action is going to be a challenge. It will be wise to wait for a pullback to downside support before diving in. Buying from a Fibonacci retracement level or moving average will be an ideal way to take a long position n coming sessions.