Oil struggling for direction at $46.00, eyeing EIA data for fresh impetus

Extending its Wednesday's pull-back, WTI crude oil dipped below $46.00 as traders remained worried over the possible rise in US crude supplies. The black gold, however, has managed to recover a bit and is currently trading back above $46.00/barrel mark.

After Tuesday's sharp recovery of nearly 5% from two-month low level of , traders would have been inclined to lock-in some profits ahead the official EIA report on weekly US crude oil inventories data. Consensus estimates expect inventories to fall for eighth straight week by 2.3 million barrels.

On Tuesday, API reported that US crude supplied unexpectedly rose by 2.2 million barrels, which has been weighing on the black gold on Wednesday on renewed worries of global supply glut. 

Any further signs of oversupply would now seem to continue dragging the commodity lower in the near-term.

Technical levels to watch

Sustained weakness below $46.00 handle has the potential to drag the commodity back towards $45.00 before extending the weakening trend towards 100-day SMA support near $43.60-50 region. 

On the flip side, $46.50 remains immediate hurdle to clear, above which the commodity seems to extend the recovery trend beyond $47.00 handle, towards 50-day SMA resistance near $47.90-48.00 region.