On Monday oil market is making attempts to reclaim positions after losses during Friday’s session.
Oil quotes dropped after China has announced imposing new tariffs on $75 billion worth of american imports including oil. Trump promised to strike back. Investors are concerned, that new escalation of trade relations between two world’s top economies can reduce consumption of fuel. Analysts pointed to the fact, that import of american oil to China has declined substantially over the last months.
Now investors expect a new round of negotiations between USA and China, that is scheduled for September in hopes to see some progress in international trading. Though some analysts are sceptical about the idea of prompt recovery of full-scale trading relationship between two countries.
Market got some local support this morning from comments of China’s Vice-Premier Liu He, who claimed a desire to resolve the conflict during further negotiations. But in general prospects of market’s recovery in current circumstances remain limited.
On the chart the price stays in the range between the 57.50-60.60 levels for several weeks already. Bears once again failed to break support at 57.50, therefore sideways trend moves on.
Resistance levels: 60.60, 62.30, 64.30;
Support levels: 57.50, 55.55, 55.00.
Main scenario: Growth towards 60.60.
Alternative scenario: Break of support at 57.50 and decline towards 55.55.
Negative fundamental sentiment prevails on the market, but on the chart sideways trend is still in place. For intraday trading we can consider short-trades as well as long-trades from the boundaries of 57.50-60.60 channel.