Crude Oil Trades the Range While Investors Focus on US-China Trade Talks Today
the WTI crude oil prices are consolidating in narrow trading ranges of $53.90 - $51.30. On Tuesday, crude oil prices soared 2%. Here's why?
It’s been two weeks that WTI crude oil prices are consolidating in narrow trading ranges of $53.90 – $51.30. On Tuesday, crude oil prices soared 2% in response to the news that the United States has inflicted new sanctions on Venezuelan state-owned oil company PDVSA. This move can limit the exports from Venezuela and can support falling crude oil prices.
The recent weakness in the US dollar is also making crude oil less expensive for foreign investors, causing a rise in its demand. The FOMC and Fed rate decision are likely to determine further trends in the market.
Most importantly, investors are eyeing the US-China trade talks which discuss deep differences over Washington’s demands for structural economic reforms from Beijing. The economic reforms are making it hard to reach an agreement before March 2, the tariff rate hike date.
Lastly, I would suggest monitoring the Energy Information Administration’s crude oil inventories data at 15:30 (GMT). Economists are expecting a build of 3M vs. 8M which can extend slight support to crude oil prices today.
WTI Crude Oil – Trade Plan
As long as crude oil is trading within the trading range of $53.90 – $51.30, consider taking a sell position below $53.90 with a 40 pips stop loss above it. While buying is preferred above $51.30 with 40 pips stop loss below buying level.
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