- Oil prices have been rising on the day, but technically trapped in a bar trend.
- Fundamentals are a weight and focus is on the downside.
Oil prices have been rising on the day, with WTI rising from a low of $53.71 to a high of $55.05, +2.31% on the day so far. Futures also rose on Tuesday, with U.S. prices up by more than 2%, on OPEC production cuts noise and expectations for a sizable weekly decline in U.S. crude supplies. October West Texas Intermediate oil CLV19, +2.52% climbed $1.29, or 2.4%, to settle at $54.93 a barrel on the New York Mercantile Exchange
The Organization of the Petroleum Exporting Countries' Joint Ministerial Monitoring Committee pegged July compliance with pledged output cuts at 159% which was the highest monthly compliance rate so far this year. Meanwhile, ahead of government supply data due tomorrow, a survey of analysts polled by S&P Global Platts showed that there are expectations for a 4.7 million-barrel decline in last week's U.S. crude stocks.
Geopolitical front
On the geopolitical front, besides the conflicting signals about the prospect thawing US-Sino tensions, the G-7 gathering saw some additional geopolitical drama develop with Iran with foreign minister Zarif making a showing. "While this prompted speculation that it could lead to a resolution in the conflict, which would see Iranian oil flow back into the market, the reiteration that limiting missile testing was off-limits promptly quelled those hopes," analysts at TD Securities argued.
WTI levels
Despite the comeback, the price is deteriorating in a broader view of the charts, pressured below the descending resistance line, pressured below the near term GMMA band now below the 20-daily moving average. With a focus on the downside and having taken out the trendline support, bears can now target a drop to the 52 handle and the 61.8% Fibo at 51.70 on the wide.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to gains above 1.0750 after US data
EUR/USD manages to hold in positive territory above 1.0750 despite retreating from the fresh multi-week high it set above 1.0800 earlier in the day. The US Dollar struggles to find demand following the weaker-than-expected NFP data.
GBP/USD declines below 1.2550 following NFP-inspired upsurge
GBP/USD struggles to preserve its bullish momentum and trades below 1.2550 in the American session. Earlier in the day, the disappointing April jobs report from the US triggered a USD selloff and allowed the pair to reach multi-week highs above 1.2600.
Gold struggles to hold above $2,300 despite falling US yields
Gold stays on the back foot below $2,300 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.6% after weak US data but the improving risk mood doesn't allow XAU/USD to gain traction.
Bitcoin Weekly Forecast: Should you buy BTC here? Premium
Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.
Week ahead – BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.