Crude Oil market under long liquidation; Support seen at 3627
Commodity Online | January 11 2019
UPDATED 12:07:14 IST

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Technically Crude Oil market is under long liquidation as market has witnessed drop in open interest by -6.08% to settled at 14084 while prices down 8 rupees.

Now MCX Crude Oil is getting support at 3627 and below same could see a test of 3577 levels and resistance is now likely to be seen at 3723, a move above could see prices testing 3769.

Crude Oil prices slid and gave back some of their gains after jumping more than 5% on Wednesday amid optimism on Sino-U.S. trade talks. China said trade talks with the U.S. were “extensive and detailed,” and that both sides agreed to continue to keep in close contact.

Meanwhile, reports that OPEC kingpin Saudi Arabia has vowed to “stabilise” the market also provided support for oil prices. Saudi Energy Minister Khalid al-Falih said actions taking by the OPEC+ alliance were starting to bring the market back after a near-40% drop from 2018 highs.

Falih said the kingdom was pumping about 800,000 barrels less a day from the record high of 10.2 million barrels per day in November. On the other hand, the U.S. Energy Information Administration said that crude inventories fell by 1.68 million barrels for the week ended Jan 4., about a third less than the 2.4 million-barrel draw forecasted.

On the products side, gasoline inventories rose by 8.07 million barrels, more than double the expected build of 3.39 million barrels. They were also 8% above the 5-year average, the EIA said. China said three days of talks with the United States that wrapped up had established a “foundation” to resolve differences over trade.

But it gave few details on key issues at stake, including a scheduled U.S. tariff increase on $200 billion worth of Chinese imports.

Trading Ideas:
--Crude oil trading range for the day is 3577-3769.
--Crude oil prices slid and gave back some of their gains after jumping more than 5% on Wednesday amid optimism on Sino-U.S. trade talks.
--Saudi Energy Minister Khalid al-Falih said actions taking by the OPEC+ alliance were starting to bring the market back after a near-40% drop from 2018 highs.
--China said trade talks with the U.S. were “extensive and detailed,” and that both sides agreed to continue to keep in close contact.

Courtesy: Kedia Commodities

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