WTI extends recovery above $ 61 mark, EIA data eyed

• Stalled USD buying aids oil-price recovery.
• Will it hold above the 61 handle?
• EIA crude inventory report in focus.

WTI (oil futures on NYMEX) stalled its downslide and now extends its recovery mode beyond the $ 61 threshold amid a retreat in the US dollar against its major peers from eight-day tops of 90.17.

The barrel of WTI dropped sharply for the second straight session, largely on the back of broad-based US dollar strength, fueled by upbeat Fed’s outlook on inflation and economy, which implied faster pace of tightening in the coming year.

The FOMC minutes-led rally in the US dollar overshadowed the API report of a decrease in the US crude inventories. The API report released late-Wednesday showed an unexpected drop in the US crude oil stockpiles by 907,000 barrels to 420.3 million barrels for the week to Feb. 16.

Later today, the official US government figures on the US crude supplies hog the limelight and provide fresh direction on oil prices. The US crude oil stockpiles will rise by 1.3 million barrels in the week to Feb. 16, the EIA data will show.

WTI Technical Levels

At $ 61.20, the resistances are aligned at $61.69 (5-DMA), $62.03 (20-DMA) and $62.66/64 (50-DMA/ 4-day tops). On the downside, the supports are located at $60.83 (5-day lows), $60.27 (Feb 8 low) and $60 (psychological support).