WTI sold-off in tandem with equities, EIA data eyed

• Risk-aversion, stronger DXY and oversupply concerns weigh heavily.
• US GDP and EIA crude stockpiles data to offer some respite?

WTI (oil futures on NYMEX) extends its corrective slide from two-month tops into a third day today, as the sell-off in the European equities curbs the appetite for risk assets such as oil.

Moreover, persisting broad-based US dollar buying amid a rally in Treasury yields also adds to the declines in the USD-sensitive commodity. A stronger US dollar makes the USD-denominated oil more expensive to the buyers in foreign currencies and vice-versa.

The barrel of WTI also remains undermined by an unexpected build seen in the US crude stockpiles, as reflected by the latest American Petroleum Institute (API) report released late-Tuesday. The data showed the US reported a surprise 5.3 million barrels rise in crude stocks in the week to March 23, to 430.6 million barrels.

Looking ahead, markets await the official US inventory data that will be published by the Energy Information Administration (EIA) for fresh direction. In the meantime, traders digest the latest comments from the Iraqi and Saudi Energy Ministers.

WTI Technicals

At $ 64.52, the resistances are aligned at $ 65 (round number), $ 65.45 (5-DMA) and $ 65.74 (Mar 22 high). On the flipside, the supports are located at $ 64.38 (daily low), $ 64 (key support) and $ 63.58 (Mar 21 low).