Some fundamentals and technicals are indicating a bearish move in Crude Oil prices.
Crude Oil rally, from 40 USD to 65 USD triggered by the OPEC cuts seems like losing its strength.
Negative Fundamentals of Crude Oil:
Russia does not seem to be willing to make new supply interruptions
The possibility that China’s future 4th-quarter growth data may not meet expectations tomorrow may push prices down. ( Data will be released tomorrow )
Global demand: Oil markets are heavily dependent on demand and supply talks. There are no strong significant evidence of Global demand.
US Drillers: One of (if not the biggest) the contributors to the downfall in oil prices in recent years. Higher prices and more shale production. It is a question mark.
We may see a technical correction.
I will be focusing on the trend line .
Crude oil needs to make H4 closings above 64.10 to continue its bullish move. Price will remain under bearish pressure as long as it holds below 64.10.
The current level is 63.73. The break out of the trend line ( we can say an hourly closing below 63.50 ) will carry the price towards 63.20 and 62.50.
62.50 is the main support.
I suggest watching 64.10 resistance. If the price can not make H4 closing above the resistance we may see a bearish move towards 62.50.
Crude Oil rally, from 40 USD to 65 USD triggered by the OPEC cuts seems like losing its strength.
Negative Fundamentals of Crude Oil:
Russia does not seem to be willing to make new supply interruptions
The possibility that China’s future 4th-quarter growth data may not meet expectations tomorrow may push prices down. ( Data will be released tomorrow )
Global demand: Oil markets are heavily dependent on demand and supply talks. There are no strong significant evidence of Global demand.
US Drillers: One of (if not the biggest) the contributors to the downfall in oil prices in recent years. Higher prices and more shale production. It is a question mark.
We may see a technical correction.
I will be focusing on the trend line .
Crude oil needs to make H4 closings above 64.10 to continue its bullish move. Price will remain under bearish pressure as long as it holds below 64.10.
The current level is 63.73. The break out of the trend line ( we can say an hourly closing below 63.50 ) will carry the price towards 63.20 and 62.50.
62.50 is the main support.
I suggest watching 64.10 resistance. If the price can not make H4 closing above the resistance we may see a bearish move towards 62.50.
Comment:
Trade reached the Fibonacci 23.60% (63.00 USD ) ..62.50 and 61.80 will be the next targets of the Crude Oil.
Comment:
There is a new fundamental which may have a negative effect on Crude Oil prices. As published in Bloomberg: Speculation Grows That OPEC Will End Cuts Early as Prices Rise.
The highlight of the news: “As oil trades near a three-year high and crude stockpiles fall rapidly, analysts are questioning whether the OPEC-led production cuts will last until the end of the year. As the producer group gears up for a meeting with its partners to review strategy in Muscat, Oman, this weekend, there are growing expectations that the deal will be phased out early.”
However, after the news, Russian Ministry of Energy said that they have no intention to cut the supply earlier.
62.50 remains as the critical support for the short term. And we can not talk about a bearish midterm trend as long as the price stays above 62.50.
Our first target of SHORT trade was 62.80 and Crude Oil prices tested 62.80. Crude ended week 63.55.
As seen in H4 Chart, 63.55 is the median line ( SMA 20 ) of the Bollinger Band and Fibonacci 38.20% retracement of the latest bullish move on H4 Chart. It is just 15 pips above EMA 50.
If the price cannot break above the current level, the shorter bearish pressure will continue and Crude will test 62.50 support. ( Needs to make an H1 closing below 62.80)
The highlight of the news: “As oil trades near a three-year high and crude stockpiles fall rapidly, analysts are questioning whether the OPEC-led production cuts will last until the end of the year. As the producer group gears up for a meeting with its partners to review strategy in Muscat, Oman, this weekend, there are growing expectations that the deal will be phased out early.”
However, after the news, Russian Ministry of Energy said that they have no intention to cut the supply earlier.
62.50 remains as the critical support for the short term. And we can not talk about a bearish midterm trend as long as the price stays above 62.50.
Our first target of SHORT trade was 62.80 and Crude Oil prices tested 62.80. Crude ended week 63.55.
As seen in H4 Chart, 63.55 is the median line ( SMA 20 ) of the Bollinger Band and Fibonacci 38.20% retracement of the latest bullish move on H4 Chart. It is just 15 pips above EMA 50.
If the price cannot break above the current level, the shorter bearish pressure will continue and Crude will test 62.50 support. ( Needs to make an H1 closing below 62.80)