- WTI bounces away from lows of $ 80,900, gains of $ 1.50.
- The EIA cut the forecast for oil demand for 2022.
- WTI Technical Outlook: Bullish pennant on the 4-hour chart, $ 86.00 targets.
The Western Texas Intermediate, also known as WTI, advanced in the American session, rising almost 2%, trading at $ 82.93 per barrel at the time of writing this article. During the day, oil fell below the key psychological $ 81.00 level, finding support at the 50 SMA at $ 80.99, which limited downward pressure on the benchmark US crude oil index. In addition, it recovered some initial losses on positive news that the EIA cut the forecast for oil demand for 2022.
According to Bloomberg, Short Term Energy Outlook (STEO) predicted the market would be oversupplied early next year and reported that prices would fall in December from current levels. Market participants eagerly awaited the report, as sources said the Biden administration was considering reducing US Specific Petroleum Reserves (SPRs).
Crude oil prices have risen as vaccination rates have risen and COVID-19 cases have declined around the world. That facilitated blockades, in turn, increased people’s mobility, and consequently spurred higher demand for oil. According to sources cited by Bloomberg, demand “is going to be reasonably tight” over the next 12 months, and prices are expected to rise to $ 100 a barrel.
The White House has put pressure on OPEC and its allies to increase crude oil production, but the cartel stood by and stuck to its target of 400,000 barrels of crude per day.
At 21:30 GMT, the American Petroleum Institute (API) will reveal its weekly crude stocks for the week ending November 8. The previous reading was 3,594 million. A higher report than the one mentioned above could be bearish for WTI, otherwise it could boost the WTI outlook for higher prices.
WTI Price Forecast: Bullish Pennant on 4-Hour Chart, Targets $ 86.00
The 4-hour chart shows that WTI is breaking the top of a bullish pennant that, based on technical analysis measures, could propel WTI towards $ 86.00 a barrel, but should close above it. In that result, the first resistance would be the November 1 high at $ 83.97. A breach of the latter would expose the 2021 high at $ 85.00 and then the bullish pennant target.
Technical Levels / Resistance and Support Levels
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