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Oil at a crossroads!
By: Ahura Chalki
Unlike stock markets, which yesterday mostly recovered some of their loss of last week, Oil still suffering. OPEC monthly report (1) which published yesterday, shows that Global demand will fall by 9.46 million barrels per day, up from the 9.06 million barrels per day forecast of last month. Also, they believe that the coronavirus effect on the market will be for a longer time, which is expected to make it harder for this group and its allies to support the market.
On the other hand, when stock markets rise, we also expecting to see the rise in energy markets as well, as the signal of more demands in factories and economies. Besides all of them, positive news from the Vaccine front, supposed to help the market.
Fundamentally, as we can see in the H1 chart, the market will be caution and waiting for today’s API and tomorrows EIA reports, while ahead of a meeting later this week of OPEC and its allies, known as OPEC+, economic data especially from China shows some sort of recovery, which we can count on.
Technically, in the H1 chart, while side movement creating the range of $36.85 – 37.65, in the H4 chart, the triangle pattern is creating by LH and HL, signaling of possible bullish, especially if it can breathe the resistance in 20 and 50 MA in H4 charts, sittings at $37.34 and $38.40 respectively, however by having RSI at 45, the trend seems so weak for that and need more motivation, which can come from today’s massive data ahead, after positive industrial data from China and Employment data from the UK, which shows the better way of recovery.
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