Crude oil yesterday opened at 4948 and jumped to test 5025 level tracking international futures and dipped once again as weak US economic data and a stronger dollar depressed prices despite Middle Eastern supply fears, traders are eyeing for the release of the US Energy Dept's weekly inventory data later in the day.
Report indicating that manufacturing activity in the Chicago area declined in January to the lowest level since August.
Additional negative U.S. economic news included the Case/Shiller home price index for November dropping more than expected and booking the 17th straight monthly decline.
Meanwhile, lawmakers on the US Senate Banking Committee plan to vote on a new round of Iranian sanctions adding to the supply concerns.
Last week, the EU agreed to ban oil imports from Iran starting on July 1 to pressure the oil producing nation to terminate its nuclear program.
In other news, South Sudan’s oil minister stated that the country has totally shut off oil output in response to a conflict over export transit fees.
Now technically market is trading in the range as RSI for 18days is currently indicating 34.26, where as 50DMA is at 5195.76 and crude is trading below the same and getting support at 4887 and below could see a test of 4847 level, And resistance is now likely to be seen at 4996, a move above could see prices testing 5065.
Trading Ideas:
Crude trading range is 4847-5065.
Crude oil dropped as weak US economic data and stronger dollar depressed prices despite Middle Eastern supply fears
Uncertainty in Middle East stemming from Iran and its nuclear ambitions continued to provide support for the asset as well.
Today Crude Oil inventories: EXP: 3.2M PREV: 3.6M. Actual is at 9.00PM
Courtesy: Kedia Commodities
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