West Texas Intermediate crude futures rose on Friday, putting it in a position to end higher for the week as the European Union’s planned ban on Russian oil balances fears of slowing global economic growth.
This week’s price movement suggests a stalemate between bullish traders who hope the European Union’s embargo on Russian crude oil will tighten supply and bear traders who worry that higher interest rates will stifle economic growth and therefore demand for crude oil.
Stagnation of negotiations on the Russian oil embargo
EU foreign ministers failed earlier this week in trying to pressure Hungary to lift its veto on a proposed oil embargo against Russia, with Lithuania saying the bloc was “held hostage by a member state”, Reuters reported.
The European Commission’s ban on crude oil imports in early May will be its toughest sanction to date in response to Moscow’s February 24 invasion of Ukraine and involves the secession of EU countries that are most dependent on Russia. oil, added Reuters.
The IMF is urging Asia to keep in mind the risks of spillovers
Asian economies need to be mindful of the risks of spillovers as a decade of unconventional policies to ease major central banks recedes faster than expected, said Kenji Okamura, deputy managing director of the International Monetary Fund (IMF).
The risks are particularly acute for the most vulnerable economies, Okamura said.
Asian economies were faced with a choice between …
West Texas Intermediate crude futures rose on Friday, putting it in a position to end higher for the week as the European Union’s planned ban on Russian oil balances fears of slowing global economic growth.
This week’s price movement suggests a stalemate between bullish traders who hope the European Union’s embargo on Russian crude oil will tighten supply and bear traders who worry that higher interest rates will stifle economic growth and therefore demand for crude oil.
Stagnation of negotiations on the Russian oil embargo
EU foreign ministers failed earlier this week in trying to pressure Hungary to lift its veto on a proposed oil embargo against Russia, with Lithuania saying the bloc was “held hostage by a member state”, Reuters reported.
The European Commission’s ban on crude oil imports in early May will be its toughest sanction to date in response to Moscow’s February 24 invasion of Ukraine and involves the secession of EU countries that are most dependent on Russia. oil, added Reuters.
The IMF is urging Asia to keep in mind the risks of spillovers
Asian economies need to be mindful of the risks of spillovers as a decade of unconventional policies to ease major central banks recedes faster than expected, said Kenji Okamura, deputy managing director of the International Monetary Fund (IMF).
The risks are particularly acute for the most vulnerable economies, Okamura said.
Asian economies face a choice between supporting more stimulus growth and pulling it off to stabilize debt and inflation, he said.
Weekly technical analysis
Weekly July WTI Crude Oil
Trend indicator analysis
The main trend is up according to the weekly swing schedule. Trading up to $ 116.43 will signal the resumption of the upward trend. Moving to $ 61.32 will change the main downward trend. However, this is very unlikely.
The slight trend is also up. The uptrend was confirmed earlier in the week when buyers pulled out a pair of minor highs of $ 109.77 and $ 110.07. Trading up to $ 96.93 will change the slight downward trend. This will shift the momentum downward.
Correction level analysis
The first small range is $ 116.43 to $ 88.53. The market is currently trading on the strength of its zone at an adjustment of $ 105.77 to $ 102.48, which makes it supportive.
The second small range is $ 88.53 to $ 110.07. Its adjustment range from $ 99.30 to $ 96.76 is additional support.
If $ 96.76 fails as support, then we could see an acceleration down with the adjustment zone from $ 88.88 to $ 82.37 next target.
The base range is $ 34.55 to $ 116.43. If $ 82.37 fails as support, then look for sales to expand in the adjustment range of $ 75.49 to $ 65.83.
Weekly technical forecast
The direction of the June WTI crude oil market by the end of the week on May 27 will be determined by the trader’s reaction to $ 105.77.
Whip script
Prolonged movement above $ 105.77 will indicate the presence of buyers. If this move creates enough upward momentum, then look for a repeat test at this week’s highest level at $ 113.20. This is a potential unlocking point to accelerate to the high level of the contract of $ 116.43.
Swords script
Continued movement below $ 105.77 will signal the presence of sellers. If this move creates enough momentum, then look for a quick 50% test at $ 102.48, followed by another adjustment zone from $ 99.30 to $ 96.76.
Failure to hold $ 96.76 will indicate that sales pressure is growing. This could cause a breach in the maintenance cluster of $ 94.47, $ 92.15 and $ 88.53.
Removing the minor bottom at $ 88.53 could accelerate to the Fibonacci level at $ 82.37.
Short-term perspective
Technically, traders will need to continue to buy declines to maintain the bullish chart on the high-high, higher-low chart.
While the chart model suggests that sellers will have to deal with heavy pressure due to a series of potential support levels from $ 105.77 to $ 96.76, buyers are heading for the least resistance with $ 116.43 next major goal up. , followed by $ 121.17. However, bullish traders will need a catalyst or two to raise prices sharply.
The first catalyst that could cause a breakthrough will be the announcement of a ban on Russian oil products. This would tighten supply.
The second catalyst that could cause a breach will be the removal of the COVID-related blockage in China. This move would lead to an increase in demand for crude oil, as well as an upward development.
The combination of limited supply and growing demand could jump prices from $ 116.43 to $ 121.17.
Additional strength will be generated by the growing demand for American gasoline from Europe and the domestic market. In the US, prices are at record highs and we haven’t even started the summer driving season yet.
In summary, the path of least resistance is up, but traders need a catalyst or two to take advantage of the uptrend.
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