WTI drops back to test $ 64.50 on USD rebound

• Resurgent USD demand caps further upside attempts.
• Risk trends and OPEC cuts expectations to drive the oil markets.

Having witnessed a volatile session a day before, WTI (oil futures on NYMEX) continues to consolidate below the $ 65 mark, as the dust settles after the V-shaped reversal seen in US last session.

The barrel of WTI staged a solid comeback from six-day troughs of $ 63.73, reached after the US Energy Information Administration (EIA) weekly crude supplies data showed that the US crude inventories rose by 1.6 million barrels in the last week while the US output levels hit a record, at 10.43 million barrels per day (bpd).

The reversal in the black gold was mainly driven by fresh OPEC headlines that cited the OPEC telling Reuters that the Cartel and its allies were set to keep their deal on cutting production for the rest of 2018.

In the day ahead, oil prices will continue to get influenced by the USD dynamics, as investors brace for a slew of the US economic releases, including the core PCE price index, for fresh momentum.

WTI Technicals

At $ 64.52, the resistances are aligned at $ 65 (round number), $ 65.30 (5-DMA) and $ 65.74 (Mar 22 high). On the flipside, the supports are located at $ 64/63.91 (classic S1), $ 63.73 (six-day lows) and $ 63.58 (Mar 21 low).