Oil plunged several percent on Thursday. They say, the bullish rally was just too aggressive. Let's trade the dip then!
The oil market struggle: will the crude oil inventories help?
The oil prices experienced significant losses amid the US-Iran tensions at the beginning of the year. In just a week, the price for WTI fell from the highs near $65 to the levels near $57. The Brent’s price followed a similar scenario, moving down below $64. Now, both of the oil futures seem to found support at the 200-day SMA on the daily chart and need a trigger for the further move. That’s where the crude oil inventories expected today at 17:30 MT time come into play.
According to analysts, the number of barrels held in the inventories will decline by 400 thousand. If the decline is even lower, the oil prices will rebound. In case of the alternative scenario, when the Energy Information Administration reports a surprisingly high increase in the number of barrels, the oil prices will fall.
On the H4 chart of WTI, the price is currently moving towards the resistance at $58.55. If the number of barrels is lower, the price will likely break this level and rise towards the next obstacle at $59.2. When the price overcomes this level, the next resistance will be placed at $59.7. On the other hand, greater-than-expected crude oil inventories will pull the price below the $57.8 level. Further key support levels will be placed at $57.2 and $56.3.
As for Brent, its key levels from the upside lie at $64.6, $65 and $65.7. The downward momentum will be limited by $64 and $63.
The Australian economy has been on a steady recovery path, and now we have a very symbolic confirmation that S&P ASX 200 is about to cross 7000!
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The Reserve Bank of New Zealand will hold a meeting on Wednesday, April 14, at 05:00 MT.