|

WTI remains on the back foot below $78.00 mark and two-week top touched on Wednesday

  • WTI is undermined by a surprise build in US inventories and lower demand growth forecast by IEA.
  • The Fed’s hawkish surprise lifts the USD and weighs on the dollar-denominated commodity.
  • The lack of strong follow-through selling warrants caution before positioning for deeper losses.

West Texas Intermediate (WTI) US crude Oil prices trade with a mild negative bias during the Asian session on Thursday, albeit lack bearish conviction and remain well within the striking distance of a nearly two-week high touched the previous day. 

Official data published by the Energy Information Administration (EIA) on Wednesday showed that US Crude inventories grew by 3.7 million barrels in the first week of June. Adding to this, the International Energy Agency (EIA), in its monthly report, trimmed the outlook for Oil demand growth in 2024 by 100,000 barrels per day to 960,000 bpd. Apart from this, some follow-through US Dollar (USD) buying, bolstered by the Federal Reserve's (Fed) hawkish surprise, further seems to undermine USD-denominated commodities, including Crude Oil prices.

The Fed kept interest rates unchanged at the end of a two-day policy meeting and now see the benchmark rate falling to 5.1% this year, suggesting just one rate cut in 2024 as compared to three estimated in March. The shift in projection provides a modest lift to the US Treasury bond yields and assists the USD to build on the overnight bounce from the weekly low touched in the aftermath of softer US consumer inflation figures. That said, persistent geopolitical tensions in the Middle East might continue to lend some support to Crude Oil prices and limit losses. 

Market participants now look to the US economic docket, featuring the release of the Producer Price Index (PPI) and the usual Weekly Initial Jobless Claims data later during the early North American session. This, along with the US bond yields and the broader risk sentiment, will influence the USD and provide some impetus to Oil prices. The aforementioned fundamental backdrop, meanwhile, warrants some caution before positioning for a firm near-term direction.

WTI US OIL

Overview
Today last price77.84
Today Daily Change-0.14
Today Daily Change %-0.18
Today daily open77.98
 
Trends
Daily SMA2077.25
Daily SMA5080.04
Daily SMA10079.23
Daily SMA20079.27
 
Levels
Previous Daily High78.98
Previous Daily Low77.59
Previous Weekly High77.36
Previous Weekly Low72.46
Previous Monthly High81.25
Previous Monthly Low76.04
Daily Fibonacci 38.2%78.45
Daily Fibonacci 61.8%78.12
Daily Pivot Point S177.39
Daily Pivot Point S276.8
Daily Pivot Point S376
Daily Pivot Point R178.77
Daily Pivot Point R279.57
Daily Pivot Point R380.16

Author

Haresh Menghani

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

More from Haresh Menghani
Share:

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

By subscribing you agree to our Terms and conditions.

Editor's Picks

EUR/USD rebounds after falling toward 1.1700

EUR/USD gains traction and trades above 1.1730 in the American session, looking to end the week virtually unchanged. The bullish opening in Wall Street makes it difficult for the US Dollar to preserve its recovery momentum and helps the pair rebound heading into the weekend.

GBP/USD steadies below 1.3400 as traders assess BoE policy outlook

Following Thursday's volatile session, GBP/USD moves sideways below 1.3400 on Friday. Investors reassess the Bank of England's policy oıtlook after the MPC decided to cut the interest rate by 25 bps by a slim margin. Meanwhile, the improving risk mood helps the pair hold its ground.

Gold stays below $4,350, looks to post small weekly gains

Gold struggles to gather recovery momentum and stays below $4,350 in the second half of the day on Friday, as the benchmark 10-year US Treasury bond yield edges higher. Nevertheless, the precious metal remains on track to end the week with modest gains as markets gear up for the holiday season.

Crypto Today: Bitcoin, Ethereum, XRP rebound amid bearish market conditions

Bitcoin (BTC) is edging higher, trading above $88,000 at the time of writing on Monday. Altcoins, including Ethereum (ETH) and Ripple (XRP), are following in BTC’s footsteps, experiencing relief rebounds following a volatile week.

How much can one month of soft inflation change the Fed’s mind?

One month of softer inflation data is rarely enough to shift Federal Reserve policy on its own, but in a market highly sensitive to every data point, even a single reading can reshape expectations. November’s inflation report offered a welcome sign of cooling price pressures. 

XRP rebounds amid ETF inflows and declining retail demand demand

XRP rebounds as bulls target a short-term breakout above $2.00 on Friday. XRP ETFs record the highest inflow since December 8, signaling growing institutional appetite.