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API data supported oil prices

The oil market today is holding positions in the positive territory, responding to reports of a decrease in oil reserves of 4.8 million barrels according to API data.

 

Investors were relieved after the last day of trading for the June futures on WTI ended without incident. Many were afraid of a recurrence of the April situation and a decline in quotations to the negative zone.

 

The API data had a positive impact on the market. Experts expected an increase in reserves by 2.4 million barrels. Actual data indicate a decrease of 4.8 million barrels. The mood of investors before the publication of data by the US Department of Energy has improved. The forecast assumes an increase in reserves by 1.15 million barrels.

 

Apparently, a large-scale production decrease in OPEC + and the USA began to bring first positive results and the market is gradually coming into balance.

 

Despite this, experts are still very skeptical about the chances of the further development of the bullish movement on oil. Demand for energy is growing at a very slow pace and could decline again if the second wave of a pandemic begins. The number of cases continues to increase and approaches 5 million people. The economies of the largest countries in the world are entering a recession stage.

 

Regarding the chart, the bears continue to keep the price below 32.10. Trading takes place in a very narrow range and the priority scenario remains with the price breaking out of this flat down.

 

  • Resistance levels: 32.10, 33.75, 35.70.

 

  • Support levels: 30.30, 26.90, 23.90.

 

The main scenario - a decline towards 30.30.

 

An alternative scenario - a consolidation above the level of 32.10 and an increase towards 33.75.

 

The current fundamental outlook is neutral. We consider shorts with very moderate risks. We expect for entry points to be found in the range of 32.10-32.50.

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