Crude Oil trades lower on rising US rig count, sell on rallies
US crude oil hits high at $59.02 and shown a minor decline from that level. The 14 – member OPEC along with 10 oil states outside OPEC has agreed to extend the production cut till 2018 year end. The crude oil prices recovered till $58.86 after OPEC meeting and started to decline. The production will also extend to Nigeria and Libya this time as previously exempt form production quotas due to political unrest.
The oil prices is still declining after Saudi and Russia production cut deal. The main reason for the oil price decline is US shale oil production. US producers benefits a lot due to the production cuts. U.S oil production has already reached a record of 9.66 million b/d and is expected to jump 9.9m b/d in December. US total rig count increases by 6 this week to 929 and according Baker Hughes oil rigs drilling for oil up by 2 at 749 this week.
Technically, oil is facing strong support at $57 (20- day MA) and any break below will drag the commodity to next level till $56.40 (61.8% fibo)/$56.10 (daily Kijun-Sen)/$55. The commodity should close below $54.10 (50 day MA) for further weakness.
On the higher side, near term resistance is around $58.05 and any break above will take the pair to next level till $58.85/$59.02.
It is good to sell on rallies around $57.75-80 with SL around $58.85 for the TP of $56.45/$55.
The oil prices is still declining after Saudi and Russia production cut deal. The main reason for the oil price decline is US shale oil production. US producers benefits a lot due to the production cuts. U.S oil production has already reached a record of 9.66 million b/d and is expected to jump 9.9m b/d in December. US total rig count increases by 6 this week to 929 and according Baker Hughes oil rigs drilling for oil up by 2 at 749 this week.
Technically, oil is facing strong support at $57 (20- day MA) and any break below will drag the commodity to next level till $56.40 (61.8% fibo)/$56.10 (daily Kijun-Sen)/$55. The commodity should close below $54.10 (50 day MA) for further weakness.
On the higher side, near term resistance is around $58.05 and any break above will take the pair to next level till $58.85/$59.02.
It is good to sell on rallies around $57.75-80 with SL around $58.85 for the TP of $56.45/$55.
