On Wednesday, oil prices are under pressure after the publication of API data on a sharp rise in US oil reserves.
During the reporting week, oil reserves increased by 7.5 million barrels, after falling by 8.3 million barrels a week earlier. Experts had expected a decline of 2.1 million barrels. Investors fear that a new wave of COVID-19 spread in the United States could slow down the recovery in energy demand.
For the first time in June, the number of deaths from COVID-19 per day exceeded 1,000 people. According to the latest data, the number of deaths from the virus is increasing in 21 states. Local authorities are increasing quarantine measures to contain the virus. Fuel demand in the US is declining again.
Commenting on the situation with COVID-19, Donald Trump admitted that in the near future, the epidemiological situation in the country may worsen.
Pressure on the market may also come from media reports that Iraq is not yet ready to fulfill its obligations to cut production under the earlier OPEC+ agreement. Iraqi oil exports averaged 2.70 million barrels per day in the first 20 days of July, according to Refinitiv Eikon and two industry sources.
Today the focus of the market will be on data on reserves from the EIA. Experts predicted a decline of 2.1 million barrels. The API data indicates that the actual values may be worse than market expectations, which may increase pressure on oil prices.
Regarding the chart, the price tested the resistance at 42.30. Today, most likely, we will see a retest of this mark. If the bulls overcome it, the next upside target will be 43.75. If the retest is unsuccessful, we can expect a fairly strong rollback to 38.70.
The main scenario - a rise to 42.30 and further downward movement.
An alternative scenario - a breakdown of resistance at 42.30 and an increase to 43.75.
The current fundamental outlook is moderately negative. We would consider shorts from the level 42.30.
Only from April 12, 2021, to May 14, 2021, Deposit Bonus 200% is available for all FortFS clients! Use the advantage to engage for the unique offer within a limited period: activate the deposit bonus and get up to 200% on the deposit amount on your trading account! How to get a Deposit Bonus of […]
FortFS wishes all traders a Happy Chinese New Year! Only from February 8 to March 12, 2021, we reduce spreads for the 4 most popular trading pairs. New values*: EURUSDf: 0.8 GBPUSDf: 0.9 USDJPYf: 1.0 XAUUSDf: 3.5 *These values are valid only for FLEX accounts Hurry up to take advantage of the offer! Learn more about spreads: https://www.fortfs.com/clients/specifications