Large build in inventory data has pushed the price lower
The weekly crude oil inventories showed a huge surge of 15.2M barrels in the current inventory data. 11.8 million was in the Gulf Coast. That is the highest increase on record. The expectations were for a drawdown of 1.4M.
The price of crude oil has moved down to a low price of $45.10. The current price trades around $45.24.
Technically, the moved to the downside has taken the price below the 200 hour moving average currently at $45.36. The 100 hour moving average is higher at $45.77. Staying below both those moving averages tilts the bias more to the downside. A trendline on the hourly chart cuts across at $44.94. Below that lows from December 3 at $44.66 area would be the next target. The 38.2% retracement of the move up from the November 13 low comes in at $44.25.
Taking a broader look at the daily chart, the high from last week extended above the 61.8% retracement of the years trading range at $46.43. The last 2 trading sessions have remained below that level. There have been no closes above the 61.8% retracement.
The range for the month is still relatively modest with a low $43.92 and a high price of $46.68.
On the downside, the August swing high came in at $44.59. That level will also be eyed as a target on the downside. Get below should be more bearish.
The inventory data was such a shock, that a caveat maybe that it must be something that will be reversed, or has a "reason" that was simply not anticipated. So watch the technicals for price action clues. Nevertheless with Covid, the supply and demand can get out of whack as people stay close to home.