Crude oil holding recent gains
Front-month WTI fell back close to $80 per barrel yesterday before it bounced sharply. This move should be encouraging for bullish investors as it suggests that oil prices may have found a good level of support. If it continues to hold, and if prices now consolidate between $80 and $81, then the bulls could have a launchpad for further gains. This assumes that the pull-back since Friday was enough to blow some froth off the rally which began in early June. If not, and if there’s a break below $80, WTI could then fall back to retest the area between $77.70 and $78.20 as the next significant support level. Yesterday, the US Energy Information Administration reported bigger-than-expected crude and gasoline inventory draws. This helped put a floor under prices. Prices rallied a touch following today’s lower-than-expected CPI release. Headline CPI dropped to 3.0% year-on-year, lower than both the 3.1% expected, and the prior reading of 3.3%. While still significantly above the Fed’s 2% target, this latest drop has raised the probability of two 25 basis point rate cuts before year-end.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.