This morning oil prices rose more than 1% ahead of an OPEC meeting which is expected to push the group and its allies including Russia to agree to further output cuts to support the market. But will that be enough to support oil prices in the long term? Given the overall downtrend in oil prices because of the rapid spread of the coronavirus which has been weighing on the transport industry, we would expect oil prices to dip lower again, sooner rather than later.
Oil could therefore soon weaken further, especially if the demand in travelling stays weak and economic activity remains low. Before the OPEC meeting, we like to sell USOIL at 46.70 with SL at 48.60 and TP at 44.90.
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