WTI: Bulls await API data to attack $41.00

WTI struggles to extend recovery moves from $40.74 beyond $41.00.
Virus woes join OPEC output increase to combat drop in Russian oil production.
US Factory Orders, API inventories will be the key.

Anil Panchal FXStreet

WTI eases to $40.88, down 0.10% on a day, while heading into the European open on Tuesday. The oil benchmark managed to flash gains for the last two days but a quiet Asian session seems to limit the moves off-late. As a result, traders eye the weekly release of private stockpile data from the American Petroleum Institute (API) for fresh impetus.

Recovery in the US economics, coupled with hopes of the further stimulus from global policymakers, led-by America, seems to have offered the latest bids to the back gold. Also supporting the mood could be the month-end position adjustments.

Even so, the recent increase in the Organization of the Petroleum Exporting Countries (OPEC) output driven by Saudi Arabia joins the broad fears of the coronavirus (COVID-19) led economic halt to challenge the bulls. “OPEC increased its output by 900,000 barrels a day last month to 23.43 million a day as Saudi Arabia, the United Arab Emirates and Kuwait restored additional production that was cut in June,” said Bloomberg. Talking about the virus, the World Health Organization (WHO) President Dr. Tedros Adhanom Ghebreyesus warned, as per the Sky News, while saying that there may never be a "silver bullet" to beat coronavirus (COVID-19). Additionally, the US policymakers’ struggle to agree over the much-awaited stimulus also weighs on oil prices.

It should also be noted that news suggesting a drop in Russia’s output by 16% in July failed to grab major attention. The reason could be traced from Russian Energy Ministry data, as reported by Reuters, suggesting a daily average output of 9.37 million barrels in July versus 9.32 million barrels in June.

Moving on, any further fall in the API Weekly Crude Oil Stock, for the period ending on July 31, could help the energy benchmark to cross $41.00. However, an increase in inventories versus -6.829M prior will join COVID-19 woes and policy deadlock in the US to target a sub-$40 area during the fresh downside.

Technical analysis

A falling trend line from July 21, currently around $41.45, precedes the previous month’s top near $42.55 while challenging the bulls targeting February month bottom close to $44.00. On the contrary, $40.00 and 50-day SMA near $39.30 restricts the quote’s short-term downside.

Additional important levels

Overview
Today last price	40.88
Today Daily Change	-0.05
Today Daily Change %	-0.12%
Today daily open	40.93

Trends
Daily SMA20	40.92
Daily SMA50	39.17
Daily SMA100	32.26
Daily SMA200	43.58

Levels
Previous Daily High	41.37
Previous Daily Low	39.75
Previous Weekly High	41.99
Previous Weekly Low	39.1
Previous Monthly High	42.52
Previous Monthly Low	38.73
Daily Fibonacci 38.2%	40.75
Daily Fibonacci 61.8%	40.37
Daily Pivot Point S1	39.99
Daily Pivot Point S2	39.06
Daily Pivot Point S3	38.37
Daily Pivot Point R1	41.62
Daily Pivot Point R2	42.31
Daily Pivot Point R3	43.24

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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