Confines in a $2.00 range as investors await US Inflation for a viewpoint

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• Oil price is auctioning in a bounded range amid an absence of a potential trigger.
• Bearish bets for the oil price were accelerating as investors are worried about oil demand due to escalating global recession fears.
• The USD Index has stretched its recovery to near 102.15 amid soaring expectations of one more rate hike from the Fed.

West Texas Intermediate (WTI), futures on NYMEX, have dropped after failing to sustain above $81.00 in the Tokyo session. The oil price is confined in a narrow range of $79.00-81.80 from the past week after the announcement of surprise production cuts by OPEC+ to provide stability in black gold.

Bearish bets for the oil price were accelerating as investors are worried about oil demand due to escalating fears of global recession amid policy-tightening by central banks.

The US Dollar Index (DXY) has stretched its recovery to near 102.15 amid soaring expectations of one more rate hike from the Federal Reserve (Fed). Going forward, the release of the United States Inflation data will provide more clarity. As per the consensus, the headline Consumer Price Index (CPI) will decelerate to 5.2% from the former release of 6.0%. Contrary, the core CPI will inflate further to 5.6% from the prior release of 5.5%.

The oil price is consolidating in a narrow range of $79.00-81.80 near the horizontal resistance plotted from March 07 high around $81.00 on a two-hour scale. The 20-period Exponential Moving Average (EMA) at $80.53 is overlapping the oil price, indicating rangebound moves.

Meanwhile, the Relative Strength Index (RSI) (14) is oscillating in the 40.00-60.00 range, which conveys that investors are awaiting a potential trigger.

Should the oil price break above April 04 high near $81.80, bulls will drive the asset towards December 01 high at $83.30 followed by October 21 high at $85.66.

On the flip side, a downside move below March 31 low at $73.31 would drag the asset toward March 23 high at $71.69. A break below the latter would further drag the oil price toward March 27 low at $69.18.

WTI two-hour chart