For the second consecutive week, the crude oil inventory data showed a larger than expected build. Last week, the build was 18.962M barrels. This week, another 8.408M were added (well above the -0.593M drawdown expected).
And for the 2nd consecutive week, the price of crude oil initially dipped, only to rebound back higher. The price just reached reached a new session high of $81.49. The current price is at $81.10.
Looking at the hourly chat, the dip after the inventory release, saw the price move back below its 100 hour moving average currently at $79.84, but it was only briefly before the price rebounded back to the upside.
This type of price action occurred on the last release on January 11. However on that day, the price dipped back below its 200 hour moving average only to snap back higher, and close near the high for the day (see chart above).
There seems to be an underlying bid in crude oil. Yes there are dips, but it seems the China reopening is being repriced.
Nevertheless, what the 100 hour moving average for bias defining clues. Move below again and there should be more selling. Until then, the $82.66 level is next upside target.
PS Yesterday, the 100 day moving average – currently at $82.57 – stalled the rally. If there is a support against the 100 hour moving average, there is resistance against the 100 day moving average as well.