WTI Price Analysis: SMA 50 in 4 hours defends the drop before the API

• WTI price is reversing a drop to 108.00 amid risk aversion.
• Holding above the 50 SMA on the 4-hour chart is critical for oil bulls.
• The RSI defends the midline and supports the bulls ahead of the API data.

The WTI (NYMEX futures) is attempting a bounce back above the $109.00 levelafter finding strong buying just above $108.00 in the last few hours.

US oil rebound occurs even though risk sentiment remains sour amid a revival of global growth fears, in the wake of disappointing UK and eurozone manufacturing and services PMI reports for May.

Resumption of US Dollar Sell-off Could Favor Black Gold’s Latest Rally, while the markets remain hopeful that there will be a further reduction in US crude oil reserves. The American Petroleum Institute (API) will release its weekly crude stock change report towards the close in New York at 20:30 GMT.

From a short-term technical point of view, the rising 50 SMA on the 4-hour chart at $108.88 has come to the rescue of the bulls as they have managed to regain control above it.

WTI traders are now watching for a sustained move above the horizontal 21 SMA at $109.10 to consolidate the recovery momentum.

Acceptance above that level will prompt the bulls to retest the level of the bulls. $110.00. Above, the previous day’s high in $111.25 could be challenged by bulls,

The 14-day RSI is rising just above the mid-line, which suggests that the recovery may have some way to go.

WTI 4 hour chart

On the other hand, a four-hour candlestick close below the 50 SMA will reignite bearish interest. WTI will resume its downward correction towards daily lows of $108.04 one more time.

The next major bearish target is at the rising 200 SMA at $106.63.

WTI additional levels