The weekly EIA crude oil inventory report showed that crude oil stocks rose by more than market consensus, and this sent crude oil price below the $53 level. At the time of writting, WTI crude oil prices are trading at $52.78, and it looks like crude oil prices are on their way to reach the $52.28 support I identified previously today.
Crude oil inventories rose by 3.104 million barrels last week, as against the 1.567 million barrels that analysts had predicted. The increase in stockpiles adds yet another fundamental pressure to crude oil prices.
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Now that $52.28 level is firmly in focus, intraday traders should pay attention to price behavior at this level. If crude oil price breaks the $52.28 support to the downside, we could then see further weakening which brings the lows of August 7 into focus. This is also the site where the double bottom of May and June 2019 was formed.
If the crude oil price gets rejected at the $52.28 support level, then there will be a good chance for a retest of the 23.6% Fibonacci retracement at $54.20, the neckline of the May-June 2019 double bottom.