CRUDE OIL PRICE FORECAST – OIL COULD CLIMB FURTHER AS VOLATILITY DRIFTS LOWER; MARKIT PMI DATA ON DECKCrude oil value motion pier
CRUDE OIL PRICE FORECAST – OIL COULD CLIMB FURTHER AS VOLATILITY DRIFTS LOWER; MARKIT PMI DATA ON DECK
- Crude oil value motion pierced the $43.00/bbl stage amid prevailing urge for food for danger
- Crude oil value development stays bullish because the commodity maintains key shifting averages
- Falling market volatility and stable Markit PMI information may propel oil costs greater
Crude oil value motion has lacked path as of late with the commodity buying and selling largely sideways over the past two months. That stated, crude oil appears prefer it may very well be attempting at its subsequent leg greater with costs perched across the $43.00-handle and month-to-date highs.
| Change in | Longs | Shorts | OI |
| Each day | 0% | -5% | -2% |
| Weekly | -2% | -2% | -2% |
CRUDE OIL PRICE CHART: DAILY TIME FRAME (23 APRIL TO 18 AUGUST 2020)
Chart created by @RichDvorakFX with TradingView
The crude oil value development nonetheless appears bullish because the commodity broadly maintains its 8-day and 34-day shifting averages. Although upward momentum has largely stalled since June, it appears like optimistic divergence between the short-term shifting common and medium-term shifting common may quickly resume. This is perhaps indicated by a bullish MACD crossover.
CRUDE OIL PRICE CHART & VIX INDEX OVERLAID: 4-HOUR TIME FRAME (14 MAY TO 18 AUGUST 2020)
Chart created by @RichDvorakFX with TradingView
Regardless of conflicting elementary headwinds, equivalent to curbed OPEC+ provide cuts within the midst of recovering financial exercise, it seems that the commodity is gaining floor on the again of sustained danger urge for food and volatility suppression. That is highlighted by the sturdy inverse relationship sometimes maintained between crude oil and the VIX Index.
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On that word, upcoming Markit PMI information set for launch this Friday, August 21 may weigh materially on market sentiment and thus the path of crude oil value motion. International financial exercise is anticipated to proceed its rebound from coronavirus-related fallout, but when proof of a stalling restoration is alluded to by this main indicator to world GDP progress, bearish headwinds may very well be launched.
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— Written by Wealthy Dvorak, Analyst for DailyFX.com
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