Crude oil was pointing lower for a second day after the commodity looked set to test the $50.00 price level. Oil prices saw their biggest drop in six weeks as the vaccine enthusiasm gave way to fears over new lockdowns in the U.K. which could lead to lower demand and restrictions on travel, air travel and also container ship movements.
Bloomberg also reported that strong Asian refinery buying was beginning to recede. Processors in the region have acted earlier than usual and almost completed their purchase needs for spot cargoes that will be loaded in January and February. This has driven up prices in many regional benchmarks into year-end. The market may also be at risk of a wind down in risk assets as portfolio managers square positions at the end of the year.
Crude Oil Technical Outlook
Crude oil was set to test the $50 level but has now pulled back for a secon day. Next support would be at $45 or at $43.50 where the 50-day moving average lies. Support for risk assets would see another push towards $50. The Investing Cube team is currently available to help all levels of traders with the Forex Trading Course or one-to-one coaching.
Crude Oil Daily Chart