During Wednesday's (February 28th) Asian session, WTI crude oil traded in a narrow range, currently hovering around 78.2.

During yesterday's Asian session, oil prices experienced a slight correction, dropping to around the 77 level. Subsequently, during the US session, prices surged significantly to around 78.7, before facing pressure and oscillating around the 78 level. Yesterday's correction was primarily technical, with some calming of geopolitical tensions, as Biden expressed belief in a ceasefire in the Gaza Strip within a week, contributing to the price correction. The rebound occurred following news that OPEC+ was considering extending voluntary production cuts into the second quarter of this year and potentially extending them until the end of the year, which boosted prices. However, the unexpected increase of 8.428 million barrels in API crude oil inventories announced early this morning led to a slight decline in oil prices. The impact was not significant because gasoline inventories decreased by over 3 million barrels. Additionally, the escalation of Russia's restrictions on gasoline exports since Monday helped counteract the bearish impact of inventory levels.

Although yesterday's rebound was stimulated by OPEC+ production cuts, it's noteworthy that improving marginal demand played a more significant role. Confidence among bulls grew, especially as gasoline inventories plummeted during the night session. Additionally, Chinese petroleum inventories dropped by nearly 8 million barrels, signaling a potential emergence from the demand slump. However, this still needs time to be validated. As long as there are no significant bearish supply-side developments in the near term, the market remains prone to upward movement, given the gradual improvement in market sentiment.

In terms of trading, oil prices dropped to around 77.0 during the Asian session yesterday and rebounded to 78.7 at their peak, with a slight correction towards the end of the session. Our strategic trading range is between 76.5-78.5, with slight profits from short positions near the 78.5 level.

Data-wise, US API crude oil inventories unexpectedly increased by 8.428 million barrels for the week ending February 23rd, compared to an expectation of 1.8 million barrels. Gasoline inventories decreased by 3.272 million barrels, compared to an expectation of -1.2 million barrels.

Focus of the Day: EIA crude oil inventory data, significant changes in geopolitical risks, and January's core PCE data.

Yesterday, oil prices experienced a slight correction to around the 77 level but quickly rebounded after finding support. The easing of geopolitical risks did not lead to an expansion of price declines. Even the unexpected inventory buildup in the early morning only resulted in a minor pullback. This indicates the current market sentiment is relatively optimistic, supported by previous improvements in demand. Yesterday's significant drop in gasoline inventories further validates this trend. Additionally, under the backdrop of monetary easing, oil prices may continue to rise.

In terms of technical analysis, in the hourly chart, the MACD indicator is developing towards a death cross, suggesting a potential short-term correction during the day, but the magnitude of the correction is expected to be limited. After a pullback to the support of the lower Bollinger Band, there might be a rebound during the night session. Currently, bullish sentiment prevails, and the possibility of new highs cannot be ruled out. In the 4-hour chart, oil prices near the upper Bollinger Band show a small bearish penetration line, suggesting a potential intraday bearish momentum, potentially resulting in another bearish candlestick close. Specific intraday trends will depend on hourly market dynamics. The daily candlestick closed with a bullish tone, marking a consecutive two-day uptrend. The overall trend in the market appears clear, especially with the MACD showing a bullish crossover again. There's a high probability that the upward movement will continue, but caution is warranted as the market approaches overbought territory. Significant resistance is anticipated at higher levels. For the intraday outlook, the high could temporarily reach around 79.50.

For intraday trading, investors can continue to buy low and sell high within the range. The trading reference range for today remains between 77.5 and 79.5.

Trading Direction: Long

Entry Price: 77.500

Target Price: 79.500

Stop Loss: 77.000

Support: 76.500, 75.500

Resistance: 78.500, 79.500