Global macro overview for 18/05/2017:
Surprising Crude Oil Inventories data made a spike up and reversal on the oil market yesterday. The latest Energy Information Administration (EIA) data reported an inventory draw of 1,750k barrels in the week ending May 12th following a draw of 5,250k barrels in the previous week. This recent draw was lesser than market expectations of 2,500k barrels. As a result, the inventories are at the lowest level in 10 weeks but overall are still 2.2% above year-ago levels. This is why the recent decrease in inventories is still not enough for global investors to catch a breath of relief as they still want a sustained evidence that inventories are declining for good.
Let's now take a look at the Crude Oil technical picture on the H4 time frame. The price is still trading above the 50% Fibo at the level of $48.75, but there was no attempt of a sustained rally towards the technical resistance at the level of $50.23 yet. The momentum indicator bounced from the fifty level, so the momentum is still strong and positive. In that case as long as the technical support at the level of $48.24 - $48.01 is not violated, the short-term bias is still to the upside. The next target for bulls is the 61%Fibo at the level of $49.93 or technical resistance at the level of $50.23.
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