WTI juggles around $104.30, downside looks likely on escalating recession fears


  • Oil prices have failed to surpass the critical hurdle of $107.23 amid escalating recession fears.
  • Higher interest rates by the global central banks have raised the oil demand worries.
  • The EIA weekly oil inventory report is postponed to next week, as reported by Bloomberg.

West Texas Intermediate (WTI), futures on NYMEX, is portraying a mute performance in the Asian session after sensing significant offers while overstepping the critical hurdle of $107.23. The black gold has remained in the grip of bears this week after the market participants underpinned the demand worries over the supply constraints.

No doubt, the sanctions on Russia after it invaded Ukraine have settled a tight oil market for the global economy for a prolonged period. However, the recently grown recession fears after the global central banks started running towards policy tightening measures to fix the inflation mess are guiding the oil prices now. In June, most of the Western central banks announced a rate hike of 50 basis points (bps). The mighty Federal Reserve (Fed) went beyond the expectations and announced a 75 bps rate hike.

The announcement of higher interest rates has eventually slashed the extent of economic activities whose effect is clearly visible on the US Purchase Managers Index (PMI) numbers. The Manufacturing PMI has landed at 52.4 much lower than forecasts and the prior print of 56 and 57 respectively. Also, the Services PMI has slipped sharply to 51.6 from the consensus of 53.5 and the prior print of 53.4. Lower economic activities will result in lower demand for oil and henceforth lower oil prices.

Volatility has been accelerated in the oil counter amid a surprise delay in the weekly U.S. oil inventory report, which Bloomberg said was held up by “power issues” and unlikely to see publication until next week.

WTI US OIL

Overview
Today last price 103.66
Today Daily Change -0.24
Today Daily Change % -0.23
Today daily open 103.9
 
Trends
Daily SMA20 114.67
Daily SMA50 109.09
Daily SMA100 104.22
Daily SMA200 90.88
 
Levels
Previous Daily High 109.29
Previous Daily Low 101.17
Previous Weekly High 121.02
Previous Weekly Low 106.2
Previous Monthly High 118.66
Previous Monthly Low 97.21
Daily Fibonacci 38.2% 104.27
Daily Fibonacci 61.8% 106.19
Daily Pivot Point S1 100.29
Daily Pivot Point S2 96.67
Daily Pivot Point S3 92.17
Daily Pivot Point R1 108.4
Daily Pivot Point R2 112.9
Daily Pivot Point R3 116.52

 

 

 

 

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