Oil prices are trading about one percent higher intraday on Wednesday. Price action looks to have cleared the key hurdle near the 40.50 level.
However, prices are not out of the woods yet as crude oil might still be at risk of a pullback lower.
A breakout above 42.00 will, however, confirm the bullish continuation in oil prices.
For the moment, we expect crude oil to maintain a sideways range between the 42.00 and 40.00 levels.
The minor support near 38.00 continues to remain key in case of a move lower.