Instaforex: Crude Oil Analysis

[abu85]

Technical analysis of US Oil for May 06, 2016

After breaking the descending channel the US oil continued rising and met the resistance at 46.00 which is the 23.6% Fibonacci applied to the channel breakout point. This level was rejected twice. This should result in the US oil weakness in the mid term. The rate could retrace back to retest the 200D Moving Average near the S2 (39.00) support. Consider selling the US oil at the current rate (44.00) targeting the S2 support, which is the channel breakout point. The stop loss should be just above R1 (46.00) Support: 42.10, 39.00, 36.00 Resistance: 46.00

 

[abu85]

Crude Oil Technical Analysis for June 28, 2016

Technical outlook and chart setups: Crude oil has already resumed its downtrend, possibly wave 5, which is setting up for a drop below 26.00 levels going forward. The journey has begun from 51.50 levels, and the price is now trading around 47.50 levels, after hitting fresh lows at 45.80 earlier. Please note that this counter-trend movement has a potential to rally to 48.70 levels, which is also the Fibonacci 0.618 resistance of the drop between 50.50 and 45.80 levels. Bulls are expected to remain in control in the short term, before letting bears take control back. It is recommended to remain flat for now and wait for prices to reach 48.70 levels, before taking short positions. Immediate support is seen at 45.80 levels, while resistance is at 48.80 levels.
Trading recommendations: Remain flat for now, look to sell higher at 48.70 levels. Good luck!

 

[abu85]

Technical analysis of USOIL for October 31, 2016

USOIL clearly trending downwards and this tendency is likely to continue. On the 26th of October WTI rejected the 50 Moving Average. Fibonacci applied to that corrective wave shows potential downside targets. At this point, the downtrend is likely to continue but consolidation can take place before that. Consider selling USOIL on a corrective wave up while the price is near 49, targeting either 261.8% (47) or 361.8% Fibs (45.80). The suggested stop loss is just above 50. Support: 48.10, 47.00, 45.80 Resistance: 48.8, 50.00

 

[abu85]

Crude Prices Edge Down on Projected U.S. Stockpile Build

Oil prices declined after industry data are seen to indicate a possible night week in a row of inventory builds, causing concerns regarding an oil glut despite output curbs to resurface. International Brent crude futures edged down 29 cents or 0.5% to $55.63 per barrel, extending a 0.2% drop in the prior session. Meanwhile, U.S. WTI also retreated by 34 cents, down 0.6% to $52.80 per barrel, further declining after a 0.1% decline in the previous session. According to analysts, oil continues to be range-bound and is currently in a dilemma. If prices fall below the $50-per-barrel mark, OPEC and other non-OPEC members who have agreed on a reduction will deepen their production cuts. If prices rises above $55, the U.S. will pump more crude. U.S. crude stocks climbed by 11.6 million barrels in the latest week, over five times estimates of a 1.7 million barrel build, according to API. If the numbers are reaffirmed by official government data from the U.S. EIA, it would log the ninth consecutive week of stock builds.

 

[abu85]

Euro and oil headed for a restricted growth

The European Central Bank Chief Mario Draghi's speech yesterday further provided the euro with support. This came as the currency disclosed their upcoming monthly highs against the greenback, allowing them to reach new and larger resistance levels. Draghi said the eurozone economy will receive backing from the increasing number of investments and productivity amid a recovery process. He added that productivity will is expecting a development because of economic improvement, which will also boost investments. Overall, the general state of the EURUSD pair remains positive. The current break of the next high, which is 1.1420 as updated during the morning Asian session, can result to a demand for risky assets in order to meet the new annual level of 1.1470 and 1.1530. This will display a huge profit-taking after the initial rising wave of euro growth. If sellers are able to maintain the 1.1420 range today, tomorrow will make it easier to adjust for a small correction on this month's results. Meanwhile, in Germany, inflation data is expected to be released along with a weekly report about the US labor market. This could lead to market to heightened market fluctuations. In case the consumer price index data beats the forecasts, the demand for euro will again continue.

Oil quotes are interesting topic as well. After a significant decline last week, the commodity has been opting for a rebound over the past three days. Yesterday, the US Department of Energy expressed support for "black gold," as stocks issued a less-than-expected stock growth. A report from the Energy Information Administration of the US Department of Energy cited that oil reserves hiked by 100,000 barrels from June 17-23. Gasoline stocks, on the other hand, decreased by 900,000 barrels while distillates were down by 200,000 barrels. Nevertheless, it is considered too early to form conclusions regarding an upward trend in oil. The existing recovery quotations are more linked to the correction, which has a real basis for indicating potential growth.