Oil price is moving higher on Thursday, with the price is holding above $45/barrel which is near 6-month due to the decline of US oil production and weakening USD. However, some analysts are still wondering whether the oil price will remain in positive trend considering the fact that the change in oil supply is not yet significant.
The WTI price for June delivery rose as much as 0.73% at around $45.66/barrel at 16:40 GMT, which is the highest level since November 2016.
The US Energy Information Administration on Wednesday released data that domestic oil production has declined as much as 15,000 barrels per day to 8.938 million barrels per day. It means that the US oil production has declined for seven weeks in a row; however, crude oil supply is still up 2 million barrels per day.
The oil price currently is in upward trajectory, testing the intraday key resistance area at 45.73. If the price managed to break the resistance, I expect it will continue the rally up to 46.28-46.73.
Note that hourly stochastic and CCI are overbought, making a correction possible. In that case, watch for bullish signal confirmation on a pul-back move to within the Fibonacci support area at 44.97-44,51 as signal to go long with 45.26 as target and 45.72 in extension.
Be careful if the price managed to break the support at 44.51 because it will turn the intraday bias to bearish and possibly will be followed by a bearish move to 44.17-43.75.