WTI on the offers around $ 71 mark ahead of EIA data

• Signs of ample supplies, IEA report outweigh tightening supplies on OPEC cuts, Iran sanctions
• WTI to keep a close eye on EIA stockpiles data for fresh signals.

Having failed to sustain the bounce above the $ 71 mark, WTI (oil futures on NYMEX) continues to wave around the last, with downside risks still in place should the US EIA crude stockpiles report show an inventory build.

The sentiment around the black gold remains sour so far this Wednesday, as markets weigh in signs of ample global supplies in physical crude markets, despite hopes of tightening supplies amid US sanctions on Iran and the OPEC output cuts deal.

Also, the warning issued by the International Energy Agency (IEA) today in its monthly oil market report, citing that global oil demand may suffer as crude nears $80, added to the weight on the commodity.

Focus now shifts towards the US weekly crude inventory report published by the EIA due later today for fresh direction on the prices.

WTI Technical Levels

According to Slobodan Drvenica, Information & Analysis Manager at Windsor Brokers, “Oil price hit new marginally higher 3 ½ year high at $71.90 on Tuesday but reversed quickly to end day in long-legged Doji. Overall structure remains bullish and tensions in the Middle East maintains positive sentiment, but a fresh strength of the dollar could weigh on oil price. Rising 10SMA continues to track the advance and marks strong support at $70.45 (along with Monday’s correction low at $70.25) which is expected to hold and keep bulls intact. Res: 71.18; 71.61; 71.90; 72.48 Sup: 70.84; 70.45; 70.25; 70.00.”