Oil is trading 0.5% higher on the day. Crude prices were down over 1% earlier today, but those declines were completely erased following US CPI data release at 1:30 pm GMT. Softer-than-expected CPI reading boosted hopes that Fed is done hiking rates already and provided fuel for a rally on risky assets. Post-CPI USD weakening is additionally supporting commodity prices, including oil.
Taking a look at WTI chart (OIL.WTI) at H1 interval, we can see that price broke above an important technical level today. The $78.75 area is marked with the upper limit of a local market geometry as well as 200-hour moving average (purple line). A break above those two technical hurdles raised hopes for a reversal of short-term downtrend. However, one more hurdle remained - the downward trendline in the $79.50 area. It was tested and a brief break above occurred. However, bulls failed to hold onto those gains and the advance started to be pared, with price now dropping back below the aforementioned $78.75 level. A break above and return below afterwards is a strong hint that no trend reversal occurred and downtrend is still in play. Should we see pullback deepen further, the $77.75 swing area marked with previous local highs and lows, as well as 50-hour moving average (green line) will be the first target for sellers.
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Source: xStation5
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