On NYME, WTI crude for delivery in December rose up to $41.55 a barrel.
WTI crude oil (CL!1) extended losses from last week's close at 40.74 to 40.06, but that was the time when bulls became alert to push the prices higher to current levels.
Although the intraday sentiments show a little buying interests in short term but the oscillator signaling divergence already to the rising prices (currently 14 trending at 37.2280), while %D crossover on slow even below 20 alarms selling pressures (currently %D line at 16.5462 & %K at 13.0120).
Observe how volumes are getting narrowed with every attempt of rising prices which means there is no genuine buying interests.
Global oil production is outpacing demand following a boom in U.S. shale oil output and after a decision by the Organization of Petroleum Exporting Countries (OPEC) last year not to cut their supply quota.
According to recent estimates, OPEC mined approx 31.54 million barrels a day in last month, close to record-highs, as major producers led by UAE focused on defending market share by keeping production high.
The forecast for today’s EIA’s crude inventory checks to contract to 2.0M from previous 4.2M, this may create little price recovery in crude but certainly not viewed as buying opportunity.
Thus, overall even though we see a short term sentiments in this commodity we are only above 42.00 and 43.26 levels. A decisive breach above may have an intermediate run otherwise we continue to carry stance on this commodity.