Oil prices declined on Tuesday amid a moderate recovery of USD and continuing concerns about a recovery in energy demand.
Investors continue to follow the debate in the US Senate on the formation of a new economic assistance program, which could amount to 1 trillion dollars. Many experts believe that the adoption of a new package of economic stimulus measures will put pressure on USD and contribute to the growth of the American stock and oil market.
The main problem for the oil market is the fear of oversupply. Industry statistics released last week showed that the worsening epidemiological situation in the country has led to a decrease in fuel demand in the United States. Investors will be keeping a close eye on the API data released today and the EIA's weekly report due tomorrow.
Oil has been trading above the $ 40 mark for quite a long time, which may be a signal for many American shale oil producers to increase production. The United States does not participate in the OPEC + agreement, therefore, it can move to increasing production after stabilizing prices at a level acceptable to oil companies.
Regarding the chart, trading continues in a horizontal range, the boundaries of which can be designated by the levels 40.75-41.75. Today, we consider the scenario with the further development of the flat trend as a priority.
The main scenario - a consolidation in the range of 40.75-41.75.
Alternative scenario - a breakdown of resistance at 41.75 and growth above 42.30.
The current fundamental outlook is neutral. We would consider both longs and shorts from the borders of the flat at 40.75-41.75.
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