Current trend

During the Asian session, prices for WTI Crude Oil are testing 78.20 for a breakout against restrained activity in the market.

Investors are awaiting the publication of key American macroeconomic statistics on inflation, after which US Federal Reserve officials may adjust plans to launch a program to reduce interest rates. Thus, in January, the core price index of personal consumption expenditures is projected to accelerate from 0.2% to 0.4%, decreasing from 2.9% to 2.8% YoY. In addition, initial jobless claims for the week of February 23 may change from 201.0K to 210.0K, and the continuous claims for February 16 – from 1.862M to 1.874M.

The asset is supported by expectations of an extension of the current OPEC restrictions on oil production into the second quarter. Moreover, some analysts do not exclude the possibility of expanding existing measures until the end of the year to stabilize the quotes near 80.00.

On the other hand, the trading instrument is under pressure from data from the US Department of Energy’s Energy Information Administration (EIA) on oil reserves for the week of February 23, which reflected an increase from 3.514M barrels to 4.199M barrels compared to preliminary estimates of 2.743M barrels.

Support and resistance

On the daily chart, Bollinger Bands are trying to reverse horizontally: the price range is narrowing, limiting the development of the “bullish” dynamics. The MACD indicator is growing, maintaining a poor buy signal (the histogram is above the signal line). Stochastic shows similar dynamics but is near the highs, indicating the asset may become overbought in the ultra-short term.

Resistance levels: 78.00, 79.07, 80.00, 81.00.

Support levels: 77.00, 76.00, 75.00, 74.00.

Trading tips

Long positions may be opened after a breakout of 79.07, with the target at 81.00. Stop loss – 78.00. Implementation time: 2–3 days.

Short positions may be opened after a breakdown of 77.00, with the target at 75.00. Stop loss – 78.00.