Oil market is being traded in the green due to support from the data on industry statistics from the U.S. and weakening dollar.
According to the reported data by the U.S. Department of Energy oil inventories for the reporting week dropped by 3,1 million barrels whereas analysts gave the forecast of decline of the indicator by 0,8 million barrels. Data of the report also gives evidence on slowdown in oil production volumes, that decline for the second consecutive week. The indicator has declined from 12,3 million barrels to 12,2 million barrels for the reporting period.
In general quite a positive sentiment is being formed on the market now, that in medium term outlook may facilitate recovery of the oil prices. Outcome of the OPEC meeting can drive to further curtailment of supply on the market whereas meeting of the U.S. and China’s leaders on G20 summit can facilitate the resolving of trade dispute and improvement of the situation in global economy, that in future will have positive impact on oil demand level. Therefore shortly we can expect tweaking of overall tone of the market, that will engender growth of oil prices.
On the chart the price has left the sideways channel 59.50-61.45 having overcome its upper boundary. It’s a good bullish signal, that puts the next target for price movement the 63.30 level. At the same time in case this resistance is broken as well we can expect a more scaled growth of the quotes towards 66.00.
Resistance levels: 63.30, 66.00, 68.80;
Support levels: 61.45, 59.50, 58.00.
Main scenario: Growth towards 63.30.
Alternative scenario: Break of support at 61.45 and decline towards 59.50.
Locally on the market a very positive sentiment for crude oil market is being formed. Bullish signals are getting stronger on the chart, therefore within intraday time-frame we consider long-positions from the 61.75 level.