Daily Crude Oil Analsys

WTI Daily Analysis for the day trader

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

Nov 10th 2016 Updated at 10:50 pm EDT on Nov 9th 2016

For Wed, Nov 9th, I’d written “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.”  We went as low as 44.50 around 10.55 am earlier today and never looked back and went exactly 10 tics higher to 45.95 by noon EST.

We need to hold at or above 45.20 to see a true recovery in the prices for today and to eventually unwind from the disaster of election night selling frenzy. If we do that and make it even in a grinding fashion over 45.40 we may head to today’s intraday high of 45.95 painstakingly. If we do make it here on some decent volume we will eventually take on the 46-handle and tread to 46.30~46.40. At this price I would consider shorts with a nice wide 40 tics stop, as a run up has the tendency to grab shorts toward a high-of-day print. 

Failure to beat initial resistance at 45.20 means we attempt to hold initial support today in the 44.70~44.60 10-tic spread which isn’t firm support and aggressive selling would mean we take this down in a wave to about 44.35. Breaking down here on decent volume could take us anywhere in the 44.10 vicinity after which 43.84~43.80 would not seem impossible and perhaps as far as 4360/55. Any lower from here and we risk election night low of 43.07.

Cam Pivots for Nov 10th, 2016

R3=46.89 | R2=46.19 | R1=45.79 <-> S1=44.97 | S2=44.57 | S3=43.87

News & Analysis

Nov 10th 2016 Updated at 10:50 pm EDT on Nov 9th 2016

Oil prices dipped early on Thursday pulled down by rising U.S. crude inventories and as markets tried to interpret U.S. President-elect Donald Trump’s surprise victory. U.S. crude stocks rose by 2.4 million barrels to 485 million barrels last week even though refineries hiked output and imports fell, the EIA said on Wednesday.

But the inventory data was overshadowed by Trump’s election victory, which initially stunned markets and led Ian Bremmer, president of U.S. risk consultancy Eurasia Group, to predict that “the world is heading into a profound geopolitical recession.” Despite this, markets shook off initial post-election losses and recovered. “Investors have brushed aside the shock of the Trump victory in the U.S. election,” ANZ bank said. WTI crude futures were down 20 cents from their last settlement at $45.02 a barrel at the time of this writing. International Brent crude oil futures were trading at $46.29 per barrel, down 7 cent from their last close.

Goldman Sachs said a Trump presidency would likely result in higher investment and, in time, increased U.S. oil production as Trump has said he would de-regulate fossil fuel production. Internationally, the bank said Trump’s threat of renewed U.S. sanctions against OPEC-member Iran would, in the short-term, lead to higher production as it “would further incentivize Iran to maximize production in the short term rather than comply with an OPEC freeze.”

This confirmed traders’ doubts over the ability of the OPEC and other producers, especially Russia, to coordinate a planned output cut in order to prop up prices. “The outcome of the U.S. election adds to the challenges for the oil exporters because it will likely lead to weaker economic growth in an already fragile global economy. And that means additional pressure on oil demand,” said Daniel Yergin, vice-chairman of the IHS Markit think tank. In physical oil markets, the Niger Delta Avengers (NDA) militant group said it had attacked the Forcados crude export line operated by oil major Royal Dutch Shell. Shell said that it had also shut down an Escravos crude oil flow station in Nigeria’s Niger Delta after villagers staged a protest demanding aid.

WTI Crude Daily Chart Analysis

cl-daily-11-10-16

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