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WTI Crude futures are currently trading at $52.93- lower by 3.31% as compared to the previous closing price. The contract last week posted a weekly gain of 2.36% and registered its biggest weekly rise since early July.
Brent crude futures were trading at $57.40-lower by 1.54% as compared to the previous closing price. The contract advanced 1.8% last week.
Crude prices dropped today due to protracted Sino-U.S. trade war that has dragged on the global economy as well as increasing OPEC and Russian oil output.
The United States began imposing 15% tariffs on a variety of Chinese goods on Sunday (1st Sept.), including clothes, footwear, and other consumer goods.
China on Sunday (1st Sept.) pushed ahead with increased duties between 5% and 10% on American imports including crude oil and soybeans.
U.S. President Donald Trump said last week that trade officials from the U.S. and China continue to talk and meet in this month.
The U.S. EIA said in a monthly report released on Friday that U.S. crude oil output dropped for a second consecutive month in June, falling by 33,000 barrels per day to 12.08 million bpd.
According to market sources, the OPEC’s oil output advanced by 80,000 barrels per day in August, and the first monthly gain in 2019. The output rose as higher supply from Nigeria and Iraq outweighed restraint by Saudi Arabia and losses caused by U.S. sanctions on Iran.
The U.S. energy services firm Baker Hughes said in its report on Friday that the U.S. energy firms last week decreased the number of rigs looking for new oil by 12 to 742 for the week ended 30th August. The oil rig count dropped for the ninth straight month to its lowest level since January last year.
Adding to supply-side data, reports which are published by the API and the EIA every week, the API is scheduled to report U.S. crude supplies for the week ended 30th August on Wednesday. Previously, the API reported that U.S. crude supplies fell by 11.100 million barrels for the week ended August 23. The EIA will report US crude inventories for the week ended August 30 on Thursday. Previously, the EIA reported that U.S. crude inventories dropped by 10.027 million barrels for the week ended August 23.
On the technical front, the RSI is currently at 40.54% and suggests that the market can move in the downward direction. The current price is below the MA5. The current price is below the lower band of the Bollinger bands and is heading downwards.
Overall Bias is Negative and short-term trades can be initiated with below mentioned Stop Loss and Profit targets.
Trade Suggestion-Limit Sell At 53.14 Take Profit At 52.40 Stop Loss At 53.51