Crude Oil Weekly Analysis 11 May 2017

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CHARTING

The crucial points are:

1

 

Crude oil continued to fall in the past days, with the momentum strengthening, as speculation has heightened with what stance the US will take in terms of production as a result of OPEC’s production cut agreement. The price met support at 45.50 level, a level which it bounced off, motivated by the EIA’s previous week crude oil inventories report which contained negative inventories. In the crude oil inventories report of yesterday, it showed a large drawdown in inventories of -5.247.000 this year. Expectation was at -1.786.000 barrels, whilst the previous recording showed 930.000 barrels. This caused the price to fiercely breach the 47.00 level of resistance, and today we have seen this level becoming support. The price has subsequently kept moving higher in an attempt to reach the 48.00 level of resistance. Volatility is expected to become stronger, as speculation will increase ahead of the 25th of May OPEC meeting, where it’s possible to have a decision about the production output for second semester of 2017.

Charting outcome: Neutral – Marginally bullish

INDICATORS (computerized T.A)

The crucial points are:

 

2

3

The indicators are signaling that a downtrend has occurred. The moving averages slopes have almost remained the same, while both the negative and the positive dynamic has risen. The trend dynamic has marginally increased by +8.64%, whilst the market’s volatility has increased by +22.93%. Finally, the oscillators have passed into marginally oversold levels.

Indicators outcome: Marginally bearish – Neutral          

CONCLUSION

Indicators and charting are in favor of the neutral outlook. If the price breaks lower than 47.00 level of support, the next support could reach the 45.50 level. On the contrary, if the price reaches and appreciates higher than 48.00 level, the next resistance is possible to occur at 49.50 level.