WTI crude oil prices continue to sideways due to drop in US crude oil inventories. Today in the early Asian market, WTI crude oil prices continued to increase due to the decline in the US inventories. The US Crude Oil WTI futures increased by 0.3% to trade at $56.21.

A couple of days ago, the WTI stocks inventories dropped by 10.8 million barrels last week. Tensions in the Middle East also extended support to the oil markets, even though slowing global economic growth kept gains limited.

On the US and China trade front, the leaders from the US and China are ready to continue in-person trade discussions later this week.

We can say, today’s sideways trading in oil is driven by higher supply-side fundamentals and data which is showing a draw in US crude oil Inventories for the 6th-consecutive week.

WTI Crude Oil – Symmetric Triangle Pattern

Crude oil continues to trade sideways for another trading day as investors seem to face indecision whether to go long or short over mixed fundamentals. The 50 and 100 periods moving averages stay around the 58 areas, giving us enough room to complete retracement.

On the 4 hour timeframe, crude oil is trading within symmetric triangle pattern which suggests neutral bias in the market. It keeps oil prices support above 55.50 and the breakout on the lowe side can extend drop until 54.90.

Support Resistance
55.52 56.69
55.09 57.43
53.92 58.6
Key Trading Level: 56.26

Crude Oil – Trade Idea

The idea is to stay bullish above 56.30 with a stop loss below 55.90 and take profit of around 56.75. Alternatively, selling is suggested below 55.20 to target 54.90.

Good luck!