Oil Price Prediction: WTI Faces Pressure at $61.50 as Dollar Strengthens
Oil prices edged lower on Wednesday, mirroring a global risk-off sentiment as a stronger U.S. dollar and rising stockpiles pressured...
Quick overview
- Oil prices declined on Wednesday due to a stronger U.S. dollar and rising stockpiles, with WTI crude trading near $60.59.
- Global market volatility increased following a tech selloff, leading investors to avoid risk assets and favor the safe-haven dollar.
- The American Petroleum Institute reported a surprise increase in U.S. crude inventories, indicating robust supply despite OPEC+ production cuts.
- Technical analysis shows WTI crude facing resistance at $61.50, with a bearish outlook unless a decisive breakout occurs.
Oil prices edged lower on Wednesday, mirroring a global risk-off sentiment as a stronger U.S. dollar and rising stockpiles pressured crude benchmarks. Investors weighed supply-side developments and macro headwinds, with WTI crude trading near $60.59, still struggling to regain momentum after last week’s slide.
Strong Dollar and Market Volatility Weigh
Global markets faced heightened volatility after an overnight tech selloff on Wall Street rippled through Asia, prompting investors to flee risk assets. The U.S. Dollar Index (DXY) held near a three-month high, buoyed by mixed signals from Federal Reserve policymakers, who appear divided on whether another rate cut is warranted this year.
A stronger greenback typically dampens oil demand by making it more expensive for foreign buyers. “Crude oil is trading lower as risk sentiment turned sharply negative, strengthening the safe-haven dollar,” noted IG analyst Tony Sycamore.
Adding to the pressure, the American Petroleum Institute (API) reported a surprise buildup in U.S. crude inventories for the week ending October 31, a sign that supply remains robust despite recent OPEC+ curbs.
Meanwhile, OPEC+’s decision to modestly raise output by 137,000 barrels per day in December, followed by a production pause in early 2026, did little to bolster sentiment. LSEG analysts said the move “is unlikely to offer meaningful support” for prices through year-end.
WTI Crude Oil (USOIL) Technical View: Key Resistance at $61.50
From a technical standpoint, WTI crude remains constrained under a descending trendline stemming from the October peak of $63.85. The 4-hour chart shows repeated rejections near $61.50, which align with the 50-EMA and reinforce short-term bearish pressure.
Recent Doji and spinning top candles underscore indecision around current levels, while the RSI near 49 signals muted momentum and early bearish divergence. Support lies at $60.05 (38.2% Fibonacci retracement), followed by $59.26 (50%) and $58.50, where buyers previously re-emerged.
A decisive close above $61.50 could spark a rebound toward $62.58–$63.85, while a drop below $59.25 risks accelerating losses toward $57.40.
WTI Crude Oil (USOIL) Trade Setup and Outlook
Short-term traders may consider selling between $61.00–$61.50, with a stop-loss above $62.60 and profit targets at $59.25 and $58.50. Alternatively, a confirmed breakout above $61.50 could flip sentiment bullish, inviting a quick move toward $63.80.
For now, oil’s outlook remains cautiously bearish, with macroeconomic pressure, dollar strength, and supply resilience keeping the path of least resistance tilted lower, at least until demand data or Fed clarity sparks a new directional shift.
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