WTI cautious near $ 36, EIA report in focus

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 6, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Mumbai) - The US oil trades marginally higher in early Europe, bringing a halt to its 2-day decline as markets digest the latest API inventory report and await the official government for fresh momentum.

    WTI testing 36 barrier

    Currently, WTI rises 0.31% to 36.08, wavering below hourly 20-SMA. Oil prices edge higher this session and attempts to recover from two-week lows struck yesterday at 35.74 levels, as attention now shifts towards the EIA weekly stockpiles report due later today. Markets are predicting a rise of about 133,000 for last week.

    On late Tuesday, the black gold fell sharply to two-week lows below 36 threshold after the API report came out mixed, with the US crude stocks falling by 5.6 million barrels in the week to January 1, while inventories at the Cushing, Oklahoma, delivery hub rose by 1.4 million barrels.

    Moreover, the oil remains pressured amid weak Chinese PMI reports and on persisting oversupply worries, which continues to outweigh the advantage to oil markets from escalating Middle-East worries.

    After a downbeat manufacturing PMI report released on Monday, the Chinese services PMI hit a 17-month low in December, adding to fears over the strength of China’s economy. China is the second largest oil consumer.

    WTI Oil Technical Levels

    WTI oil has an immediate resistance which stands at 37/37.10 (round number/ Jan 5 High) above which gains could be extended to 37.71/79 (daily R2/ Dec 31 High). While to the downside, the immediate support is at 35.74 (Jan 5 Low), below which the prices could drop to 35 levels.
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