Oil prices reverse their course, still holding the 20-day SMA – Crypto News – Crypto News
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Oil prices reverse their course, still holding the 20-day SMA – Crypto News

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  • WTI wanders around the $81.30 zone just above the 20-day SMA.
  • The US reported weak economic activity data and lower-than-expected EIA crude stockpiles.
  • Investors eye hurricane Idalia.

In Wednesday’s session, the West Texas Intermediate (WTI) cleared most of its daily gains, taking the price to a high of $82.00 and settling near $81.30. On the data front, the US reported soft employment figures, a downwards revised Q2 Gross Domestic Product (GDP), and lower than expected US Energy Information Administration (EIA).

The Automatic Data Processing Inc. (ADP) Employment Change survey from the United States fell short of expectations in August. The figure came in at 177,000, versus the expected 195,000 and the previous figure 371,000. In addition, the Q2 GDP was revised lower to 2.1% YoY and hinted at a softening of the US economic activity. It’s worth noticing that the US is the world’s largest Oil consumer, so its economic health impacts Oil prices. That being said, the expectations of a less aggressive Federal Reserve (Fed) may limit the downside as lower rates cushion the black gold. Regarding stock figures, the EIA  reported that crude oil stockpiles fell by more than 10 million, higher than the 3.26 million expected in the week ending on August 25.

In addition, traders’ eyes are on hurricane Idalia, which neared major US oil production sites in the Gulf of Mexico, representing 15% of US oil output.

 WTI Levels to watch 

 Analysing the daily chart, WTI exhibits signs of bullish exhaustion, contributing to a neutral to bearish technical perspective. The Relative Strength Index (RSI) indicates weakening bullish momentum with a negative slope above its midline, while the Moving Average Convergence (MACD) exhibits stagnant red bars. Moreover, the pair is above the 20,100,200-day Simple Moving Average (SMA), indicating that the bulls are in command of the broader picture.

 Support levels: $81.15 (20-day SMA), $80.00, $78.50.

 Resistance levels: $82.00, $82.50, $83.00.

 WTI Daily Chart

 

 

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