Oil prices maintain positive dynamics of Monday today. Since the session opening Brent rose by 0,65% and WTI was up 0,70%.
Experts relate current growth of the quotes to meeting of negotiating groups of USA and China in Beijing. No-one expects a breakthrough in trade relationship between two countries, but at the same time many investors hope, that this meeting will be a good starting point for further negotiations in pursuit to strike the trade deal.
Besides, investors are very optimistic about chances, that Federal Reserve will cut interest rate on Wednesday at least by 0,25%, that may weaken positions of dollar in which oil is nominated. Correspondingly for foreign investors this asset will become cheaper and more attractive.
Today in USA release of weekly API report on dynamics of oil inventories is expected. This data will form investors’ expectations before publishing of the main report from the U.S. Energy Department.
On the chart trading still goes in the horizontal channel 62.30-64.00, but locally there are premises for exit of the price out of this sideways channel to the upside. In this case we can reckon on development of mid-term upward movement in direction of the 66.60 level.
Resistance levels: 64.00, 66.60, 67.30;
Support levels: 62.60, 61.00, 59.50.
Main scenario: Growth in direction 66.00.
Alternative scenario: Development of sideways channel in the 62.30-64.00 range.
Moderately-positive sentiment is established on the market, that facilitates growth of the oil quotes. Therefore for intraday trading we give preference to long-trades for this asset considering them in the vicinity of 62.30 level. We can also consider long-trades from the 63.60 level, but risks to get stop here are much higher.