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WTI Crude futures are currently trading at $38.84-higher by 1.27% as compared to the previous closing price.
Brent crude futures were trading at $40.89-higher by 0.32% as compared to the previous closing price.
Crude prices dropped today after US data showed crude stockpiles jumped to a record high, reviving concerns of a persistent glut due to weak demand.
Both contracts touched their three-month highs earlier this week. Brent crude prices have more than doubled since plunging to a multi-year low in April.
The OPEC and other oil-producing nations agreed to lower supply by 9.7 million barrels per day in April. The deal came into effect from the 1st of May.
An easing of government lockdowns has revived oil demand by boosting economic activity. The OPEC and its allies over the weekend agreed to extend the record production cut until the end of next month.
Oil markets, however, came under pressure after the UAE, Saudi Arabia and Kuwait decided not to extend their voluntary output cuts.
The head of the Nigerian National Petroleum Corporation announced earlier today that the country did not comply with an agreement by crude producers to rein in production to balance markets but will make additional cuts to make up for the lapse by mid of the next month.
U.S. Baker Hughes Oil Rig Count for the current week is scheduled to be released on Friday at 1 pm ET. The U.S. energy services firm Baker Hughes said in its report on Friday (5th June) that the U.S. energy firms decreased the number of rigs looking for new oil by 16 to 206 for the week ended 5th June.
Adding to supply-side data, reports which are published by the API and the EIA every week, the API reported on Tuesday that U.S. crude supplies rose by 8.400 million barrels for the week ended June 5. The EIA reported today that U.S. crude inventories advanced by 5.720 million barrels for the week ended 5th June.
On the technical front, the RSI is currently at 66.8% and suggests that the market can move in the upward direction. The current price is below the MA5. The %K has crossed the %D from above to the downside at around 88% and suggests that the market can move in the downward direction.
Overall Bias is Negative and short-term trades can be initiated with below mentioned Stop Loss and Profit targets.
Trade Suggestion-Limit Sell At 38.95 Take Profit At 38.30 Stop Loss At 39.25