Reduced gains on Wall Street and profit taking puts pressure on oil prices❗
WTI and Brent crude oil are down more than 2% today, breaking a 3-day upward streak. Despite this, this week is likely to close with a strong gain, which will be the third week in a row of gains. Oil has rebounded quite significantly looking at the outlook of recent months.
Moreover, we believe that today's move is not related to fundamentals, but just using high liquidity to take profits. Oil continues to have a number of supportive factors:
เริ่มเทรดทันทีวันนี้ หรือ ลองใช้บัญชีทดลองแบบไร้ความเสี่ยง
เปิดบัญชี ลองบัญชีเดโม่ ดาวน์โหลดแอปมือถือ ดาวน์โหลดแอปมือถือ- Continued dollar weakness - EURUSD at 1.1200
- OPEC+ cuts have a real impact on supply reduction
- OPEC revises demand expectations for this year up by 0.1 mbd
- Libya closes half of oil fields due to protests
We are not seeing a resumption of upward movement on the dollar today. The one negative factor for oil this week was the large increase in oil stocks. Nevertheless, looking at the chart, we observe that WTI oil is retreating clearly from testing the 200 session average. We saw a similar downward movement in April, when OPEC+ surprised with its first strong cuts. Now, however, supply is constrained enough in real terms to have an impact on price creation, so we expect the upside to continue in the near term.
Technically, of course, we are reacting to an important resistance. The nearest demand zone for oil is around USD 72.5-73.5 per barrel. However, in order to confirm our thesis of profit taking, it is worth paying attention to declines in gold or also the mixed mood on Wall Street.
Source: xStation5
