- Upside capped amid expectations of higher production from Russia, Saudi Arabia.
- But, technical setup remains supportive of further upmove.
WTI (oil futures on NYMEX) drifted lower from fresh three and a half year high reached yesterday at $ 73.06, now consolidating in a narrow range just ahead of the $ 72.50 mark.
The bulls took a breather after the latest upsurge, as worries over a rise in the production from Russia and Saudi Arabia outweighed the supply disruption threats, arising out Canada, Libya and Venezuela.
Meanwhile, confusing signals for Washington over the US-China trade spat prompted investors to lock-in gains in the black gold, as the US dollar continues its bullish streak versus its main competitors.
Despite the correction, the barrel of WTI looks to retain its upbeat momentum, as it continues to derive support from a bigger-than-expected drawdown in the US crude inventories, as reported by the EIA on Wednesday.
The US commercial crude oil inventories dropped by almost 10 million barrels in the week to June 22, to 416.64 million barrels.
WTI Technical Levels:
Resistances: $ 73.06 (multi-year tops), $ 73.50 (psychological levels), $ 74 (round number).
Supports: $ 72.31 (daily low), $ 72.04 (daily pivot), $ 70.48 (5-DMA).
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