Daily Crude Oil Analsys

Crude Oil Analysis for 11/9/2016

WTI Crude Trade Plan (Read this section carefully for trade entry/exit suggestions)

Nov 9th 2016 Updated at 9:50 pm EDT on Nov 8th 2016

For Tuesday, Nov 8th, I’d written “If we fail to take out that initial resistance which is between 45.05~45.15 we negate any buy signal and stand a chance to slide quickly to 44.50~44.40 range”  We went as low as 44.41 and then reversed right back up to 45.39. In fact, if you saw my day trading targets, I’d called 45.33 as the intraday upper level which we hit conveniently in the pit session.

Well, today was expected to be fun, the initial poll results from the general election is showing the incumbent party trailing in key states and therefore uncertainty has this Crude Oil market selling off today to a low of 43.31 and balancing now to about 43.85 as I write this report. While the overall election results are far from done, at one point the Dow futures were down as much as 500 points and therefore rallying instruments like Gold and sending other instruments like Crude Oil down to the pits. All this isn’t typical of any other election. This year it is special, as we have super special candidates. And before I veer off on a political commentary of sorts, let me focus on the task at hand which is Crude Oil.

Earlier today, we failed the trendline resistance and attempted to go up and stalled after the pit close, lost some ground on the API report but gained it all back resulting from API’s estimates of product inventories.

For Crude Oil today, the initial resistance is still in the 45.22 area despite the fact that today’s analysis will be off due the extremely volatile conditions. A clean break above here will have the shorts running for cover (especially overseas traders trading the Globex session) as we convert to a short term buy signal targeting minor resistance at 45.50~45.60 and eventually 45.85. If the news supports the incumbent political party, we will continue to perhaps rise and run into some very strong resistance at 46.25~46.35 in support of the fundamental facts more than the political squawk and call it a HOD here. 

Failure to beat initial resistance at 45.22 means no buy signal and risks 44.40 again, perhaps as far as 44.05. Political news will likely trigger further losses look for secondary support at 43.65 in oversold conditions and tertiary support at 43.40. If we happen to break all this support levels we then go to 42.95 on the way to perhaps a LOD at 42.60.
Cam Pivots for Nov 9th, 2016

R3=45.67 | R2=45.22 | R1=44.95 <-> S1=44.41 | S2=44.14 | S3=43.69

News & Analysis

Nov 9th 2016 Updated at 9:50 pm EDT on Nov 8th 2016

U.S. Crude oil prices slumped in Asia on Wednesday as investors awaited U.S. presidential election results and noted a larger than expected build in U.S. industry inventory estimates. Crude oil for December delivery on the New York Mercantile Exchange slumped 1.56% to $44.28 a barrel. Brent oil for January delivery on the ICE Futures Exchange dropped 1.0% to $45.45 a barrel. API estimates released late Tuesday showed an crude inventory build of 4.4 million barrels, and was significantly higher than the expected build of around 1.1 million barrels. Gasoline inventories fell 3.6 million barrels in the week, the same draw as seen the previous week, and distillate inventories fell 4.3 million barrels, the fifth successive substantial weekly draw. Official data from the EIA will be released Wednesday.

For the US general elections, which adds its own level of complexity to the Globex prices of instruments traded, results filtered out on Tuesday evening in the U.S., but key battleground states remained too close to call. Results will be declared state by state. If the outcome is clear, the TV networks are expected to make their official call at 11:00 PM ET.

Overnight, oil prices were lower during North American hours on Tuesday, as markets were jittery before the results of the U.S. presidential election. Global financial markets were rattled last week by signs the U.S. presidential election race between Democrat candidate Hillary Clinton and Republican nominee Donald Trump was tightening.

The possibility that producers could walk away empty-handed from the November meeting looms large after Iraq, Iran, Nigeria and Libya all signaled they might not take part in the proposed production cut deal. Russia’s unclear stance is also fueling uncertainty.

WTI Crude Daily Chart Analysis

cl-daily-11-9-16

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