ANALYSIS OF CRUDE OIL (LCOc1)
- Latest news – lower crude oil price For Asia.
- The forecast for crude oil demand is rising.
- The symmetrical triangle remains in focus – key levels are tested.
MAIN BACKGROUND TO CRUDE OIL
Major crude oil Exports from Saudi Arabia The “Arab light” is in focus today as state-owned Saudi Aramco lowers shipments to Asia in October – with the exception of the US and Europe. The price per barrel, or official selling price (OSP), was lowered from a surprising $ 1.70 to $ 1.30, which predicted a much lower discount.
Decline of the Chinese SMEs last week’s data (see calendar below) may have put pressure on Saudi Arabia’s decision after COVID-19 continued to plague the global economy. This is likely to be temporary, after which the Chinese market should recover and increase crude oil imports, while the cheaper price should further increase buyers’ interest.
Source: DailyFX economic calendar
The demand forecast in OPEC’s monthly oil market report for August shows an increase in demand crude oil To the beginning of 2022 (see graph below). OPEC + and their decision to increase monthly production are in line with OPEC’s forecast above, but challenges will almost certainly emerge along this path.
Balance of supply and demand (2021-2022):
BRENT CRUDE (LCOc1)DAILY TABLE
The chart was compiled by Warren Wenket, IG
The daily chart of crude oil today shows minimal movement, reflecting the wider financial markets as the US celebrates Labor Day. The symmetrical triangle Monitoring of the (black) formation in early July 2021 is still under consideration pricingtests the upper resistance. If this resistance zone is rejected, prices may continue in the triangle towards the support of the triangle.
Ttheme Relative Strength Index (RSI)remains in the rising pulse range (above 50), while Exponential Moving Averages (EMA) sit under recent everyday candles. The curtailment between 20 (purple) and 50-day (blue) EMAs could result in a bullish crossover, which could result in crude oil bulls flooding the market.
The long extended upper will today’s candle shows the bears ’refusal to allow trade higher $ 72.00 per barrel handle. Tomorrow’s trade could open up more volatility if the US re-enters trade.
Main obstacle levels:
Main support levels:
IG’S CUSTOMER SENTIMENT DOESN’T MATTER
IGCS shows a slight shortage of retailers Crude oil, with 55% of traders currently holding long positions (as of this writing). At DailyFX, we usually take the opposite view of the mood of the crowd, but recent changes in shorts and trousers give a different signal.
– Written by Warren Venketas for DailyFX.com
Connect and follow Warren on Twitter: @WVenketas