Crude Oil inventories yesterday showed a -10.8M shortage versus the -4.2M forecasted, however, this did not have the desired effect on prices as supply factors usually drive oil markets up. The lack of action must be due to today's meeting of the European Central Bank, which announces its monetary policy decision before a press conference with ECB President Mario Draghi is held. Moreover, global manufacturing PMI prints most probably are weighing on oil prices on the short-term, but knowing the OPEC's vigorous policies, and with Central Banks preparing to unleash torrents of cheap money, it is unlikely that oil prices will drop on the long run..
Crude oil ran into sellers again at the $57.20 to $57.40 resistance zone (R1) yesterday, as prices pulled back from the 20-period moving average finishing the session around $56. Prices continue to consolidate within a tight trading range between 55.60 and 57.40 they have been now for the last trading week. Failing to move higher again today beyond the $57.40 resistance (R1) will most likely attract more sellers as the short-term trend is still clearly bearish. Selling might speed up should prices move below the support level at $55 (S2) and nearby swing low at $54.85 where further sell stops could get triggered.
Support: 55.50 / 55.00
Resistance: 57.40/ 58.25