Crude oil prices continue lower for third day in a row giving up 0.13% at $55.48 per barrel, pressured by concerns of weak global demand and as investors keep a wait and see stance after President Trump reported that he expects to sign a part of the trade deal with China ahead of schedule. American Petroleum Institute (API) reported yesterday that Crude oil stocks at the Cushing, Oklahoma, and delivery hub for WTI crude oil increased by 1.2 mb.
Last week the EIA weekly report noted a 1.699 mb drop in USA crude oil stocks missing forecasts of an increase of 2.8 mn bbl. The drop in inventories came from steady oil production, rise in refinery usage, higher crude exports and lower imports. US crude oil production was steady at record level of 12.6 mb per day. Adding further support to crude were news reports indicating that OPEC+ producers might consider production cuts in their next meeting in December.
Many oil analysts expect WTI crude oil to remain under selling pressure in the short term due to weak global demand on the back of global growth fears, US-China trade tensions and a stronger US dollar.
Crude oil today seesaws around the 50-day moving average that provides support. A close below that support line might have negative implications and might attract more offers that will cancel the recent positive momentum which started last week.
On the downside, first support stands at daily low at $55.16, followed by October 23rd lows at $53.71. Crude oil has established very strong support at 50.50 which managed to cancel the bears several times during the year. Now on the flip side, crude first resistance level stands at the daily high at $55.57, while more offers could emerge at $56.85 the high from October 28th before an attempt to 200-day moving average at $57.15.Download our latest quarterly market outlookfor our longer-term trade ideas.
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