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25 Apr 2016
Oil pulls back from 5-month highs and settles lower
Following a choppy session, crude oil futures finally settled lower on Monday, pulling back from 5-month highs struck last week.
West Texas Intermediate oil settled at $42.64 a barrel on Nymex, down $1.09, or 2.5% on the day. With a modest decline, WTI halted a four-day winning streak. Meanwhile, Brent crude for July delivery closed at $44.36, down $0.70 or 1.55% on the session.
Investors assessed potential effects of Saudi Arabia’s economic reform plan announced on Monday, which aims to reduce its dependence on oil whilst Genscape, a US private data forecaster reported an over 1.5M barrels increase in stockpiles at the Cushing, Oklahoma delivery point in the week ended on April 22nd.
WTI technical perspective
“The commodity trades near its daily low of $42.57 a barrel, and the daily chart shows that the technical indicators have turned sharply lower from overbought levels, holding so far above their mid-lies, but in line with further declines, particularly on a break below the 42.00 figure,” said Valeria Bednarik, chief analyst at FXStreet. “Shorter term, the 4 hours chart supports some additional declines, as indicators are biased slightly lower within negative territory, although the 100 and 200 SMAs continue grinding higher well below the current level, with the shortest now around 40.70.”
Support levels: 42.10 41.40 40.70. Resistance levels: 43.10 43.80 44.50.
West Texas Intermediate oil settled at $42.64 a barrel on Nymex, down $1.09, or 2.5% on the day. With a modest decline, WTI halted a four-day winning streak. Meanwhile, Brent crude for July delivery closed at $44.36, down $0.70 or 1.55% on the session.
Investors assessed potential effects of Saudi Arabia’s economic reform plan announced on Monday, which aims to reduce its dependence on oil whilst Genscape, a US private data forecaster reported an over 1.5M barrels increase in stockpiles at the Cushing, Oklahoma delivery point in the week ended on April 22nd.
WTI technical perspective
“The commodity trades near its daily low of $42.57 a barrel, and the daily chart shows that the technical indicators have turned sharply lower from overbought levels, holding so far above their mid-lies, but in line with further declines, particularly on a break below the 42.00 figure,” said Valeria Bednarik, chief analyst at FXStreet. “Shorter term, the 4 hours chart supports some additional declines, as indicators are biased slightly lower within negative territory, although the 100 and 200 SMAs continue grinding higher well below the current level, with the shortest now around 40.70.”
Support levels: 42.10 41.40 40.70. Resistance levels: 43.10 43.80 44.50.