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U.S. West Texas Intermediate crude oil futures are trading higher late in the session on Wednesday. The market surged to its highest level since March 18 after U.S. distillate inventories posted a large drawdown and refiners ramped up activity to the highest in over a year, boosting hopes for rising fuel demand in the world’s top oil consumer.
At 20:51 GMT, June WTI crude oil futures are trading $63.66, up $0.72 or +1.14%.
According to the Energy Information Administration (EIA), distillate stockpiles fell by 3.3 million barrels in the week-ending April 23. The EIA also reported that refining rates rose to 85.4% of capacity, their highest since March 2020.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. The trend turned up earlier in the session when buyers took out $64.38. The main trend will change to down on a move through $60.61.
The market is also trading on the strong side of a retracement zone at $63.47 to $62.29 indicating strength. This zone is new support.
Daily Swing Chart Technical Forecast
The direction of the June WTI crude oil market into the close on Wednesday and the opening on Thursday will be determined by trader reaction to the Fibonacci level at $63.47.
A sustained move over $63.47 will indicate the presence of buyers. Taking out $64.53 will indicate the buying is getting stronger. If this move creates enough upside momentum then look for the rally to eventually extend into the next main top at $66.15.
A sustained move under $63.47 will signal the presence of sellers. This could lead to a pullback into the 50% level at $62.29.
A close over $63.47 could lead to a higher opening on Thursday. Volume will dictate whether we see an acceleration to the upside over $64.53.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire