April WTI Uptrend Remains Intact Despite Minor Setback

U.S. West Texas Intermediate crude oil futures are edging higher on Wednesday after recovering from earlier weakness. Uncertainty over a potential conflict between Russia and Ukraine is helping to underpin prices after a sell-off the previous session.

Traders are reacting to conflicting statements on the possible withdrawal of some Russian troops from around Ukraine amid tight global supplies and recovering fuel demand.

Meanwhile, traders await the release of weekly inventories data from the U.S. Energy Information Administration (EIA) after the American Petroleum Institute (API) reported Tuesday a smaller-than-expected crude oil draw.

At 11:00 GMT, April WTI crude oil is trading $91.38, up $1.17 or +1.30%. On Tuesday, the United States Oil Fund ETF (USO) settled at $64.26, down $2.10 or -3.17%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through $93.83 will signal a resumption of the uptrend. A move through $84.92 will change the main trend to down.

The minor trend is also up. A trade through $87.79 will change the minor trend to down. This will shift momentum to the downside. The new minor top is $93.83.

The market is currently straddling a long-term Fibonacci level at $90.74.

On the downside, the nearest support is a pair of 50% levels at $90.09 and $89.01. This is followed by a short-term retracement zone at $87.08 to $85.66.

Daily Swing Chart Technical Forecast

The direction of the April WTI crude oil market on Wednesday is likely to be determined by trader reaction to $90.74.

Bullish Scenario

A sustained move over $90.74 will indicate the presence of buyers. The first upside target is a minor pivot at $91.39. Overtaking this level will indicate the buying is getting stronger with $93.83 the next target.

The multi-year high at $93.83 is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move under $90.74 will signal the presence of sellers. This could trigger a quick break into a pair of pivots at $90.09 and $89.01. The latter is a potential trigger point for an acceleration into a pair of minor bottoms at $87.79 and $87.07, followed by the short-term retracement zone at $87.08 – $85.66.