Daily Crude Oil Analsys

Crude Oil report for trading on 12/9/16

WTI Crude intraday trade plan

Dec 9th 2016 Updated at 09:52 pm EST on Dec 8th 2016

For Tuesday Dec 7th I’d written “WTI Crude testing support at 50.10~50.00 and holding above the 49.70 stop as expected. However I am not seeing a bounce in the Globex session despite short-term oversold conditions and it does look like we will continue lower today. If I was trading this with the trend which I usually do, I’d be exiting any longs taken and hold on to shorts as long as we hold below 50.20 prince print to target 49.60~49.50 initially”. WTI Crude dipped to 49.61, which was a problem as we came right back up! Not good for the intraday trader as it would’ve perhaps grabbed your stops and moved you in the opposite direction. You always get a few-odd frustrating days in the year when you have to suffer through these moves – today, was my day.

For the upside story today WTI Crude holding above 51.05 meets first resistance at 5135/40. In the event that we do continue highe0r, I’d look for 51.60~51.65 then 51.88~51.91. Again, we have that important band of resistance between 51.90~52.30. A weekly close above tonight is required to confirm a bullish breakout. This would be a big buy signal longer term. First targets are 5315/10, 5350, 5385/90, 5410/15. 

Below 51.00 we test initial support at 50.70/50.60. In the event that we continue lower, I’d am seeing strong support at 50.00/49.90. This time longs need stops below 4955! Further losses test minor support at 4915/05 before strong support at 4860/50 for an excellent buying opportunity where the bull trend is expected to resume. 

Pivots for Dec 9th, 2016

R3=52.00 | R2=51.47| R1=51.16 <-> S1=50.54 | S2=5023.41 | S3=49.70

WTI Crude Daily Chart View


News report from WSJ from earlier today

Dec 9th 2016 Updated at 09:52 pm EST on Dec 8th 2016

Oil prices clawed back some of Wednesday’s losses to close above $50 a barrel as market participants turned their attention to a planned meeting between OPEC and non-OPEC producers to finalize. U.S. crude futures rose $1.07, or 2.15%, at $50.84 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, rose 89 cents, or 1.68%, to $53.89.  Traders continued to assess the market impact of last week’s decision to cut output by the Organization of the Petroleum Exporting Countries, and the rally that followed the announcement of the deal has slowed in recent days.

OPEC has agreed to cut output by nearly 1.2 million barrels a day for six months starting in January. The group expects other big producing countries to reduce output by another 600,000 barrels, and Russia has indicated it will take on half of that. Those cuts will be discussed at a meeting between OPEC and non-OPEC countries planned for Saturday.  U.S. crude futures dropped as low as $49.77 during the session after reports that Russia might seek to postpone the meeting. But a Russian energy ministry representative said later that the meeting is still on track. “Obviously there’s some anxiety over whether they can find that 600,000 barrels,” said Bob Yawger, head of the futures division at Mizuho Securities USA. “This is an underachieving market compared to what it was the other day.”

Some market participants say oil has gone about as high as it can without more evidence that producers will follow through on their promises, and anticipate that oil prices will stay around $50 a barrel until the extent of the cuts becomes clear.  “The dramatic 15% price spike off the OPEC deal was a bit exaggerated and the market is spending much of this week simply assessing and digesting the OPEC ‘event,'” Jim Ritterbusch, president of Ritterbusch & Associates, wrote in a client note.  While many remain doubtful that OPEC will follow through on its commitment, other analysts say that major producers have endured so much pain from low prices that they’ll be motivated to stick to the cuts. And some countries couldn’t produce more if they wanted to, since they’re already pumping close to what they’re capable of.  Gasoline futures fell 0.35 cents, or 0.23%, to $1.5047 a gallon. Diesel futures gained 0.75 cents, or 0.46%, to $ 1.6259 a gallon.


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