Crude Oil Standstill Near Two-month Low – Quick Trade Plan

During the early European session, the WTI crude oil inched higher but held near the two-month low. It’s mostly because of a rise in EIA oil inventories and record weekly domestic production.

On Wednesday, the EIA reported a build of 2.1 million barrels inventories, compared with analysts’ expectations for a decrease of -2 million barrels which gave traders another reason to short the crude oil.

Secondly, the oil shortage from Venezuela is keeping the oil prices on hold. In case you are wondering what Venezuela has to do with oil prices, it is one of the world’s largest exporters of oil and has the world’s biggest oil reserves at an estimated 296.5 billion barrels (20% of global reserves). It’s also facing the threat of U.S. sanctions which may halt oil supplies.

Technically,  the RSI below 20 suggests that oil is oversold and needs to retrace back a bit before giving us further selling. On the daily chart, oil is likely to face a horizontal resistance near $66.15 along with a support near $64.

Crude Oil - Daily Chart

 

Support     Resistance

64.49         65.79

64.1           66.18

63.45         66.83

Key Trading Level:    65.14

 

WTI Crude Oil – Trading Plan

I will be keeping a closer eye on $65.95 to target $64 and $63.85, whereas, we may have a buying signal above $66. Good luck!

 

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ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
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