West Texas Intermediate crude prices travelled over 4% higher on Tuesday between a low of $54.23 per barrel and a high of $57.43 all thanks to a drop of a geopolitical headline that seems to open the door back up for a solution to the Chinese US trade dispute. Meanwhile, the EIA will issue its report today which is expected to show a decline of 2.7 million barrels in crude supplies for the week ended Aug. 9. Adding to this, the US Consumer Price Index came in line with market expectations in July at 0.3% m/m, pushing annual inflation up 0.2% points from June to 1.8%.
Crude oil prices fired up by 4% during yesterday’s session reaching a high of $57.43 per barrel after picking up some momentum. The price currently dropped from the highs and is now trading just above the $56.27 support level after dropping from the overbought zone. The black gold could pick up some momentum again later in the day and most probably the prices will be challenging the trend line represented on the chart. The level we will be watching is the $57.81 resistance level.
Support: 56.27/ 55.73
Resistance: 56.69/ 57.40