- WTI crude oil picks up bids to widen the week-start gap towards the north.
- Hopes of more China demand, no change in OPEC+ policies keep oil buyers hopeful.
- Key US data, risk catalyst to entertain momentum traders and should be observed closely.
WTI crude oil renews intraday high near $80.20, following a gap-up start to the week, as traders await this week’s bumper data/events. In doing so, the black gold cheers the return of Chinese traders after a week-long Lunar New Year (LNY) holiday, as well as optimism surrounding a China-inspired boost to the energy demand.
Chinese traders are up for returning to the table after one week off and have already signaled readiness to boost consumption. Chinese tax authority mentioned that the week-long Lunar New Year holiday that ended on Friday propelled consumption by 12.2% from the same period last year. Furthermore, China's cabinet said on Saturday it would promote a consumption recovery as the major driver of the economy and boost imports, state broadcaster CCTV reported per Reuters.
On the other hand, Reuters quoted anonymous sources to mention that the Joint Ministerial Monitoring Committee (JMMC) of the Organization of the Petroleum Exporting Countries (OPEC) and allies led by Russia, known collectively as OPEC+, are unlikely to recommend any changes to oil output policy on February 01 meeting.
Apart from the OPEC+ and China concerns, the recently increasing odds of the Federal Reserve’s (Fed) nearness to the policy pivot also adds strength to the WTI crude oil. During the last week, the better-than-expected fourth-quarter (Q4) Gross Domestic Product (GDP) and the Core Personal Consumption Expenditures (PCE) Price Index for December gained major attention. However, the actual releases were softer than their previous outcomes and hence signaled that the Federal Reserve’s (Fed) front-loading of interest rates has finally helped exert downside pressure on spending and inflation fears.
However, the cautious sentiment ahead of the Fed meeting, OPEC+ JMMC verdict and the US employment data for January, not to forget China’s official activity numbers for January, seem to probe the Oil buyers.
Technical analysis
Although the 20-DMA puts a floor under the WTI crude oil prices near $78.70, the upside moves remain elusive unless crossing a two-month-old descending resistance line, close to $82.50 by the press time.
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 steady below 1.0800 after US PCE meets expectations
EUR/USD remains depressed below 1.0800 after soft French inflation data, amid minimal volatility and thin liquidity on Good Friday. The pair barely reacted to US PCE inflation data, with the Greenback shedding some pips. Fed Chair Jerome Powell set to speak ahead of the weekly close.
GBP/USD hovers around 1.2620 in dull trading
GBP/USD trades sideways above 1.2600 amid a widespread holiday restraining action across financial markets. Investors took a long weekend ahead of critical United States employment data next week. Fed Chair Powell coming up next.
Gold price sits at all-time highs above $2,230
Gold price holds near a fresh all-time high at $2,236 in thinned trading amid the Easter Holiday. Most major world markets remain closed, although the United States published core PCE inflation, the Federal Reserve’s favorite inflation gauge.
Jito price could hit $6 as JTO coils up inside this bullish pattern
Jito (JTO) price has been on an uptrend since forming a local bottom in early January. Since then, JTO has revisited the key swing point formed in early December, suggesting the bulls’ intention to move higher.
Key events in developed markets next week
Next week, the main focus will be inflation and the labour market in the Eurozone. We expect services inflation to be impacted by the easter effect, while the unemployment rate to be unchanged.