WTI flat-lined near $ 54 mark, awaits API inventory report

• Profit-taking slide?
• Hopes of OPEC cut extension support
• API crude inventory data on tap

The bulls took a breather on Tuesday, sending WTI (oil futures on NYMEX) slightly away from eight-month tops reached at $ 54.46 in the last US session.

WTI: $ 55 still on sight?

The black gold stalled its overnight gradual retreat from multi-month tops and now consolidates in an extremely narrow range near the 54 handle. The cautious tone witnessed around oil can be due to increased nervousness ahead of the release of the fresh weekly supplies report from the US API later on the day.

Moreover, a bout of profit-taking on account of the monthly closing, after the commodity rallied almost 5% in October, also cannot be ruled out as a key reason behind the corrective slide.

Markets believe the corrective move could extend on the news of Iraq’s move to increase oil exports from its southern ports to make up for supply disruptions caused by its northern Kirkuk fields.

However, the downside could remain capped, as the sentiment around oil prices continues to remain underpinned by the expectations of OPEC cuts extension into 2018.

All eyes now remain on the US API weekly crude supplies for the next direction on the prices. At the time of writing, WTI drops 0.24% to $ 54.02, while Brent trades 0.30% lower at $ 60.40 levels.

WTI Technical Levels

Higher-side levels: 54.46 (7-month high), $ 54.94/55 (Feb highs/ round number), $ 55.50 (psychological levels)

Lower-side levels: 53.74 (5-DMA), 53.38 (classic S2/ Fib S3), 52.88 (10-DMA)