Crude Oil Grinds Towards $70
Rowan Crosby • 1 min read
Crude Oil has been grinding its way higher over the last few sessions in what has been relatively quiet conditions.
The official EIA data on Wednesday showed a larger than anticipated draw of 6.1M barrels. Which was greater than the anticipated 2.3M barrels.
That helped spark a little bit of a bid in the short-term, but not quite the same price action we saw last week.
At the same time, Saudi Arabia has warned that it is halting all oil shipments through the Red Sea shipping lane of Bab al-Mandeb after an attack on two large oil tankers. This is really just a short-term supply shock that will even out in due course.
Interestingly, this week we have also had some positive trade talks after the US-EU started working on a deal. This might ease concerns over the tariff saga and we are seeing commodities strengthen a touch.
That is despite a USD that is also on the rise. The DXY was the strongest performer in trade yesterday.
The Technical Picture
The first upside target is to $70, however I feel that we have the potential to go back and test $70.86, which is the high volume area.
We have recently tested that level before pulling back and given the momentum I think we can find our way there.
US GDP is out on Friday and it is a big figure. If we get a beat, I expect more upside in the USD, which has the potential to weighton CL on Friday.