Exploring the intricate workings of the Crude Oil market requires a mix of sharp insight and clear communication. Today, we’re taking a pragmatic approach to Crude Oil (USoil), offering a snapshot of the current state in this ever-shifting landscape.
Amid signals from China’s demand pulse and the distant murmurings of potential US interest rate hikes, the market is finding its balance at $77.65. This represents a dip from the previous close at $79.59. All eyes are on the horizon, awaiting cues from Federal Reserve officials. Their comments at the annual meeting in Jackson Hole, Wyoming, promise insights that could steer the narrative.
On a global scale, the story of Crude Oil unfolds through the strategic decisions of key players. Saudi Arabia and Russia have stepped into the limelight, adjusting their moves to recalibrate production levels. Saudi Arabia implemented a 1 million bpd cut from July to September, while Russia’s script echoes plans to reduce exports by 300,000 bpd come August. Amidst these global shifts, the pulse of the oil narrative resonates.
Shifting our focus to the visual language of charts, US Crude Oil tells its own story. It has found its footing at the dynamic support, the 200 EMA. Today marks the third consecutive day of descent, reflecting recent market patterns. While the week began on a high note at $81, the influence of a robust US Dollar nudged oil’s price lower. Eyes are now on the resilient support at 76.5, which presents a formidable challenge. Should this defence hold strong, a potential rebound towards the $80.91 resistance level could emerge. Conversely, should support falter, the journey down to $72.40 becomes a potential scenario.
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Francois du Plessis
Market Analyst
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