Global macro overview for 30/03/2017:
According to the Energy Information Administration (EIA), data released yesterday, the buildup in inventories was at the level of 0.87 million barrels for the week ending March 24th following a build of 4.95 million barrels the previous week. The consensus provided by the market participants was at the level of 1.2 million barrels and below the API estimate of 1.9 million. This is lower than expected buildup in stockpiles made West Texas Crude Oil move higher for a second straight day up to the level of $49.74. It has been a difficult month for the oil prices, as WTI has fallen 8.6 percent. The main reason behind the drop was a concern regarding the global oil glut, as increasing US production has offset OPEC production cuts. US Crude inventories continue to show surpluses and have reached an all-time high of 534.0 million barrels, so oil prices may continue to struggle to break above the psychological $50 level.
Let's now take a look at the Crude Oil technical picture at the H1 time frame. After the rally, the market is not trading in overbought conditions and it is quite possible the lower support levels will now be tested. The supports are seen at the levels of 49.19 (immediate) and 48.85 (extended). Nevertheless, after the quadruple bottom around the level of 47.09, the overall bias remains bullish.
