Daily Crude Oil Analsys

WTI Trade Plan for trading 1/26/2017

WTI Crude intraday trade plan

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Jan 26th 2017 Updated at 1:39 am EST on Jan 26th 2017

WTI Crude sideways again holding good support at 52.75~52.65 once again with a low just 9 ticks below. I’d written:..initial resistance at 53.40~53.50 which should still be key to direction with shorts needing stops above 53.70. This level also worked perfectly as we topped at 53.47.

The EIA numbers were bearish but as is customary for WTI Crude respecting support levels, prices ran into trend exhaustion at support as prices attracted buyers and up we went to the upper levels. We came 1 tick from my upper target which was 53.58.

For the upside forecast today, holding above 53.05~53.00 re-targets first resistance at 53.40~50 which should still be key to direction and if you are shorting here blindly, you need stops above 5370. Be ready to reverse and buy a break above minor short-term trend line resistance at 53.70. A break sustained break higher targets 53.90 then strong resistance at 54.30~54.40. Try shorts with stops above 54.75.

WTI Crude good support at 52.75~52.65 important in the interim again today but if you are trying longs you will need stops at or below 52.30. If we tag on additional losses we will target 52.10~52.00 before last week’s low at 51.81~51.72. Try longs with stops below 5150. A break lower however is a sell signal targeting 5120 & 5085/80.

Pivots for Jan 26th, 2017

R3=53.73 | R2=53.32| R1=53.07 <-> S1=52.67 | S2=52.32 | S3=51.91

WTI Daily Chart  

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Crude mixed as oversupply caps gains (A Reuters story)

Jan 26th 2017 Updated at 1:39 am EST on Jan 26th 2017

Oil prices rose on Thursday, driven up by a weakening dollar, but gains were capped by plentiful supplies and inventories despite an effort by OPEC and other producers to cut output and prop up the market. Brent crude futures (LCOc1), the international benchmark for oil prices, were trading at $55.59 per barrel at 0313 GMT, up 51 cents, or  0.93 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures (CLc1) were at $53.22 a barrel, up 47 cents, or 0.89 percent.

Traders said that the increase was largely down to a weakening dollar (DXY), which has lost 3.9 percent in value since its January peak. Since oil is traded in dollar, a cheaper greenback makes fuel purchases less costly for countries using other currencies, potentially spurring demand.

However, oil price gains were capped by data from the U.S. Energy Information Administration (EIA) which showed 2.84 million barrels increase in commercial crude inventories to 488.3 million barrels, which add to a 6.3 percent rise in U.S. oil production since the middle of last year to 8.96 million barrels per day (bpd). “EIA estimates that crude oil and other liquids inventories grew by 2.0 million barrels per day in the fourth quarter of 2016, driven by an increase in production and a significant, but seasonal, drop in consumption,” the agency said.

Rising U.S. inventories and output are countering efforts by the Organization of the Petroleum Exporting Countries (OPEC) and other producers including Russia to cut supplies by almost 1.8 million bpd during the first half of 2017 in an effort to end a global glut. Key customers in Asia are also being spared any significant cuts as producers’ fear losing market share to competitors.

“The recent agreement among OPEC and non-OPEC members for oil exports reduction will not impact our commitments and oil exports to Japan since we have highly strategic relationships between the two great nations,” said Aabed Al-Saadoun, deputy minister for company affairs at Saudi Arabia’s Ministry of Energy, Industry and Mineral Resources on Friday in Tokyo.

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