Oil approaches $50.00 a barrel after inventories data

Crude advanced sharply on Wednesday, with WTI gaining over 4% on the day, as the EIA reported US crude inventories fell for a sixth straight week.

According to the EIA, crude oil stockpiles  fell by 4.1 million barrels for the week to June 24, the sixth consecutive weekly decline. The American Petroleum Institute also reported a large draw-down late Tuesday, igniting the rally.

West Texas Intermediate crude for August settled at $49.88 a barrel, up $2.03, or 4.2%, on the New York Mercantile Exchange. WTI set a session high of $50.00/bbl.

WTI technical view

“Now holding around its daily highs, the daily chart for the commodity shows that the price is now above a flat 20 SMA, whilst the technical indicators have extended their advances above their mid-lines, maintaining their bullish slopes,” said Valeria Bednarik, chief analyst at FXStreet. “In the 4 hours chart, the technical indicators head sharply higher near overbought levels, whilst the price is now well above a bullish 20 SMA and the 100 SMA, this latter, offering an immediate support around 48.80.”

Support levels: 48.80 48.20 47.50. Resistance levels: 50.00 50.60 51.25.