Oversold Oil Plunges on Easing Tensions, Stockpile Surge: Bullish Divergence Hints at Rebound?

Crude oil prices hits multi year low on easing geo political tension. It hits a low of $65.20 yesterday  and currently trading around $66.70

US  crude oil stockpiles unexpectedly rose by 3.6 million barrels during the week through February 28, 2025, surpassing analyst estimates of a 341,000-barrel gain, to reach a total of 433.8 million barrels, roughly 4% lower than the five-year average. Refinery runs also fell by 346,000 barrels per day, reducing utilization rates to 85.9% because of seasonal maintenance.

Even with the increase in crude oil inventories, gasoline inventories fell by 1.4 million barrels, and distillate inventories dropped by 1.3 million barrels, indicating ongoing demand for refining products. The surprise increase in crude inventories helped push oil prices lower, while the reduction in gasoline and distillate stocks may offer some price support if supply problems persist.

Indicators (Daily chart)

RSI(14)- 29 (Oversold)

CCI(50)- Bullish divergence

Price Resistance and Support Levels

The near-term resistance is around $67.10; any breach above this level could push prices higher to $68/$69/$70/$70.60/$71.26/$72.11/$72.85/$73.15. On the downside, immediate support is at $65 violation below targets of $63/$60.

 It is good to buy on dips around $66.28-30 with a stop-loss of around $64.80 and a target price of $70.