WTI : Price neutrality
By Alexandre Nutte
On one hand, operators are concerned about the decline in demand for crude oil with disappointing statistics, especially in China where the economic environment recovers slowly. Furthermore, the OPEC production quotas (30 million barrel/day) influence short-term oil prices.
Meanwhile, some investors seem to prefer holding on the recent series of positive macroeconomic indicators in the US, reflecting the growing demand for sustainable goods, a good sign for the future domestic oil consumption. Moreover, the current consolidation phase of the dollar should bring the prices back to the level of the past weeks.
Technically, daily data and weekly data reflect a completely neutral situation with crude oil prices bounded by USD 98/90. Most aggressive traders could use this trading range to take short and long position. In the medium term, a stronger trend might occur in case of a breakout of the trading range in weekly closing price.