Oil building on to its momentum above $48.00 mark

Extending its rebound from sub-46.00 level touched on Monday, WTI crude oil moved higher on Wednesday for second day in a row and is building on to its up-move beyond $48.00 level to currently trade around $48.40-45 band. 

A broadly weaker US Dollar, led by easing global risk aversion sentiment, is seen supporting a rebound in the black gold. The commodity also shrugged-off stronger than-expected US macro data that assisted the greenback to stage a minor recovery on Tuesday.

Tuesday's sharp rise in the commodity was back by Tuesday's report by American Petroleum Institute (API) that showed a larger-than-expected fall of 3.9 million barrels in US crude supplies. 

Oil traders now turn their attention to the closely watched official weekly inventory report that is forecasted to show a drop of 2.3 million barrels in US crude oil inventories and might provide fresh impetus for near-term direction in crude oil prices.

Technical levels to watch

On the immediate upside, $48.60-65 region seems to act as immediate supply zone, which if cleared decisively seems to lift the commodity immediately towards $49.65-70 resistance. A follow through buying interest above $50.00 psychological mark now seems to open room for a move beyond $51.00 round figure mark, towards retesting recent daily closing highs resistance near $51.45-50 region.

Meanwhile on the downside, $48.10-48.00 region now seems to provide immediate support, below which the commodity seems to immediately drop to $47.50 intermediate support before heading back to retest $46.50 support.