WTI oil futures on the New York Mercantile Exchange (NYMEX) rebounded from $71.00 on Wednesday. The rebound in WTI oil prices is gradually approaching around $72.26. Further gains in oil prices appear to be running into headwinds as investors remain concerned about the outlook for global crude demand even as central banks in the West raise interest rates.

The rebound in oil prices was supported by a drop in the U.S. dollar index (DXY). The U.S. dollar index hit a monthly low of 103.44 as a pullback in U.S. consumer prices, rising unemployment and a catastrophic bankruptcy at a Silicon Valley bank forced the Federal Reserve to hold off at its monetary policy meeting scheduled for next week hawks.

The Organization of the Petroleum Exporting Countries (OPEC) on Tuesday (March 14) further raised its forecast for China's oil demand growth in 2023 as the country eased restrictions imposed by the new crown epidemic. But OPEC kept global aggregate demand steady, citing potential downside risks to world growth.

"OPEC has provided support for an upgrade in China's oil demand outlook, although investors remain concerned about the chain financial crisis following the recent U.S. bank failure," said Toshitaka Tazawa, an analyst at Fujitsu Securities, noting whether WTI could remain at $70 a barrel. The above is being closely watched.

"A rebound in air traffic and the release of pent-up Chinese demand dominated the recovery in global oil demand," the International Energy Agency (IEA) said in its latest oil market report released on Wednesday. The IEA monthly report showed global oil inventories approaching 7.8 billion barrels, the highest level since September 2021. Russia's crude oil production rose by 130,000 barrels per day in February to 9.91 million barrels per day.

WTI cannot benefit from the IEA's bullish oil market outlook. U.S. oil fell back around $71.50, off a session high of $72.69, still up 0.23% on the day.

CME Group's latest crude oil trading data

The latest data from the CME Group crude oil futures market showed traders trimmed their open interest by 3,700 contracts on Tuesday, snapping a five-day winning streak. Instead, volume rose for the second day in a row, this time by about 73,100 contracts.

WTI crude oil prices fell sharply on Tuesday and recorded a new 2023 low near $70.80, but open interest shrank as prices fell, opening the door to a possible short-term rebound in oil prices. Oil prices may fall to the $70 mark.

WTI Oil Price Technical Analysis

Following the WTI oil price's response to longs from the March 14 low of $71.00, WTI oil prices are challenging the key resistance level formed by the February 6 low of $72.60.

Investors are better off taking a "wait and see" approach before taking any positions, as the two-hour chart shows that the rally in WTI oil prices looks solid and a breakout is likely.

The falling 20-period exponential moving average (EMA) is around $73.56, indicating that WTI oil prices are still biased towards the downside.

In addition, the relative strength indicator (14) is also in the bearish range of 20.00-40.00, indicating that the downward momentum of WTI oil prices is not over yet.

If WTI oil prices clearly break the 73.00 resistance level, the bulls will push WTI oil prices closer to the March 10 low of $75.00, and then the March 12 high of $77.50.

In addition, if WTI oil prices fall below the March 14 low of $71.00, WTI oil prices will be close to a new 15-month low of $66.10, which is the December 20, 2021 low.

Then there is the Nov. 30, 2021 low of $64.40.

WTI oil price two-hour chart

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