Freefall after tensions and NPC!

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WTI analysis – 22 May 2020

By: Ahura Chalki

WTI lost about 7% after that NPC failed to set the target for this year’s GDP. “Parting with years of precedent, China abandoned on Friday an annual growth target for 2020, in an acknowledgment that restarting its economy after the coronavirus outbreak will be a slow and difficult process…Premier Keqiang said in his annual report at the opening session that “We have not set a specific target for economic growth this year…” (NY Times).

After ongoing tensions between the US and China, now, worries about Chinese real GDP for this year and market demand brings the next pressure on Oil market.

WTI felt under $31 in the earlier Asian season, and for now market prediction can go even lower, if it breaches the psychological level of $30.

On the other hand, “the Chinese government is set to present a controversial Hong Kong security law at its congress, the most important political event of the year” (BBC). The low will be create more tensions, not just between the Mainland and Hong Kong, even between China on one side, as and the US and UK on the other side.

Today and while market risk sentiments are growing, investors and traders also will be looking at retail sales data from the UK and Canada, as well as U.S. Baker Hughes Oil Rig Count.

WTI technical overview – H4 Chart

Parabolic SAR started to put its dot above the candles, while RSI moved to 46, EMA crossing strategy also supports the bears, but the OBV trend line still positive, tangent to the mainline.

Pivot point: 33.85

Resistance levels: 34.45 / 33.25

Support levels: 33.10 / 32.45 / 31.74

Today, the expected trading range is between 31.74 support and 34.45 resistance.


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