WTI Price Forecast: 50-EMA acts as major barrier

• The Oil price trades with caution around $63.00 ahead of US oil inventory data.
• Trade tensions between the US and India could dampen the Oil demand outlook.
• WTI turns bearish on the formation of a Lower High Lower Low structure.

West Texas Intermediate (WTI), futures on NYMEX, trade cautiously near Tuesday's low of $63.00 during the European trading session on Wednesday. The Oil price struggles to gain ground ahead of the United States (US) Oil inventories data for the week ending August 22.

The US Energy Information Administration (EIA) is expected to show that Oil inventories declined again. Oil stockpiles are seen contracting by 2 million barrels, lower than the 6.01 million barrels decline recorded last week.

Meanwhile, the imposition of tariffs by the United States (US) on imports from India has raised concerns over the Oil demand outlook. US President Donald Trump has raised tariffs on India to 50% for buying Russian Oil, which will come into effect at 12:01 AM EDT or 09:31 PM IST on Wednesday, according to a letter from US Homeland Security.

Given that India is one of the largest Oil importers in the world, soft demand for energy by the Indian economy would weigh on the Oil demand.

The formation of a fresh swing low by the Oil price near $61.35 on August 13 has confirmed a lower high lower low structure, which indicates a bearish trend. The downward-sloping 50-day Exponential Moving Average (EMA) near $64.60 also suggests that the near-term trend is bearish.

The 14-day Relative Strength Index (RSI) oscillates inside the 40.00-60.00 range, indicating a sideways trend.

The Oil price could extend its downside to near the psychological level of $60.00 and the May 30 low of $59.40 if it breaks below the August 13 low of $61.35.

On the flip side, a recovery move by the Oil price above the August 6 high of $66.00 would open the door towards the July 9 high of $68.00, followed by the July 30 high of $70.00.

WTI daily chart