Brent Crude Oil Calm Ahead of US Oil Rig Count Data
Crude oil prices traded lower yesterday on the wake of crude oil inventories report from the US. WTI crude hit an intraday high at $58.59 then bottomed at $57.40. It closed 13 cents lower at $58.05.
According to the report by the Energy Information Administration (EIA), there was a surplus of 1.6 million barrels of oil held by commercial firms. This was significantly higher than the 500,000 decline in storage that analysts had estimated. As a result, crude oil prices trickled lower as the number suggests that demand for the commodity will not be as strong given that inventories are still high.
Today is Thanksgiving holiday in the US which means that there are no economic reports on schedule for crude oil. This means that the commodity will likely be dictated by market sentiment as it had been earlier this week.
On the 4-hour chart, we can see that crude oil prices have been ranging around its monthly highs between $57.40 and $58.59. Risk aversion stemming from negative developments on the US-China negotiations could push the commodity lower.
A break below support could push crude oil prices to the 200 SMA where the bottom of the rising channel is.
On the other hand, risk appetite could push crude oil prices up to its September highs at $63.36.Download our latest quarterly market outlook for our longer-term trade ideas.