CRUDE OIL PRICE OUTLOOK:Crude oil costs up with gold, inflation bets on brighter demand outlookFOMC minutes key as markets weigh Fed threshold for
CRUDE OIL PRICE OUTLOOK:
- Crude oil costs up with gold, inflation bets on brighter demand outlook
- FOMC minutes key as markets weigh Fed threshold for stimulus unwind
- WTI could also be forming bearish Double High reversal within the $66-68/bbl zone
Crude oil costs rose in a transfer that the newswires tied to a brighter demand outlook. That’s after studies that passenger site visitors at US airports jumped to the very best since March 2020, in keeping with the Transportation Safety Administration.
Curiously, the 5-year Treasury breakeven price – a measure of medium-term inflation expectations priced into the bond market – rose alongside the WTI contract. Gold costs additionally tracked increased in tandem, whereas the US Greenback wilted.
On steadiness, this speaks to a situation the place swelling demand stokes value development whereas the Federal Reserve stays gun-shy about stimulus withdrawal. Whether or not this narrative finds follow-through this week will in all probability depend upon the contents of April’s FOMC assembly minutes, due Wednesday.
Merchants will probably be desirous to glean the place policymakers draw the road between a “transitory” inflationpickup, a brief blip owing to base results (i.e. evaluating costs now to the Covid-driven depths of H1, 2020), and one thing extra lasting. This may increasingly trace at their willingness to hurry up the tightening timeline.
Within the meantime, API weekly stock movement information is within the highlight. The report will probably be weighed towards forecasts calling for a 1.37-million-barrel construct to be reported in official EIA figures mid-week. A decrease API print could increase crude costs, whereas the next one applies downward strain.
CRUDE OIL TECHNICAL ANALYSIS
Crude oil costs proceed to flirt with the formation of a bearish Double High chart sample at resistance within the $66-68/bbl space. Confirming the setup requires a push by means of minor help ranges within the 60.61-63.53 space to pierce the setup’s neckline at 57.25. A every day shut beneath this boundary would suggest a measured transfer down beneath the $47/bbl determine thereafter.
Neutralizing near-term promoting strain in all probability requires consumers to re-establish a foothold above the $68/bbl deal with. From there, the following layers of resistance on the best way upward are approximated by the 38.2% Fibonacci growthat 70.37 and the 50% degree at 74.42.
Crude oil value chart created utilizing TradingView
COMMODITY TRADING RESOURCES
— Written by Ilya Spivak, Head Strategist, APAC for DailyFX
To contact Ilya, use the feedback part beneath or @IlyaSpivak on Twitter
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