WTI snaps three-day downtrend above $68.00, focus on API stockpiles

　　WTI snaps three-day downtrend above $68.00, focus on API stockpiles, risk catalysts

　　WTI flirts with intraday high while trying to reverse pullback from monthly top.

　　US dollar pullback joins covid updates to underpin the consolidation.

　　Virus woes, stimulus fears and OPEC+ production keep sellers hopeful.

　　Weekly industry inventories, Fedspeak will be important for near-term direction.

　　WTI eases from intraday high to $68.37, up 0.22% on a day, while printing the first positive day in four during early Wednesday.

　　The oil benchmark dropped during the last three days as the coronavirus fears joined firmer US dollar and stimulus fears, not to forget the OPEC+ production aims. However, the recent consolidation in the market sentiment triggered the black golds rebound.

　　Its worth noting that the vaccine optimism and chatters surrounding the recently easy infections in Asia–Pacific underpin the latest WTI recovery. Booster shots of the vaccines are in the pipeline for Australia and New Zealand while India tops the bloc with faster jabbing and daily cases remain minimal in China.

　　On the other hand, US policymakers jostle over the Democratic Party-backed stimulus after the extended weekend. CNN marked hardships for the Democratic party-backed stimulus while saying, “House Republicans could face increased pressure to vote against a bipartisan infrastructure package when they return to Washington later this month.” On the same line, Axios came out with the news stating, “Sen. Joe Manchin has privately warned the White House and congressional leaders that he has specific policy concerns with President Biden's $3.5 trillion social spending dream – and he'll support as little as $1 trillion of it — Axios' Hans Nichols scoops.”

　　Furthermore, a spike in the Aussie covid cases roiling the previous three-day fall in infections joined the jump in the US hospitalizations and death tolls to weigh on the WTI prices on Tuesday. Additionally, chatters over a jump in prices for Asia restricting the buying from the key customer and OPEC+ push for gradually easing the production cut accord exerted more downside pressure on the commodity prices.

　　Amid these plays, the US 10-year Treasury yields ease from a two-month high, underpinning the US Dollar Index (DXY) consolidation of the biggest daily jump since August 19. Also portraying the risk-on mood is the mildly bid S&P 500 Futures. All of these favor the latest WTI rebound.

　　The weekly readings of the American Petroleum Institutes (API) Oil Stocks Change data, prior -4.045M, will be the key going forward. Also important will be the market sentiment and the US dollar moves.

　　Technical analysis

　　Despite bouncing off 20-DMA surrounding $67.30, WTI bulls will face stiff resistance from 50-DMA and a two-month-old falling trend line, respectively around $69.70 and the $70.00 psychological magnet.