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WTI Crude futures are currently trading at $51.29-higher by 2.93% as compared to the previous closing price. The contract, however, posted a loss of 4.80% in the last week. Crude prices also posted their fourth consecutive weekly decline in the last week.
Brent crude futures were trading at $55.38-higher by 2.16% as compared to the previous closing price. The contract declined by about 4% in the last week.
Crude prices rose today amid hopes for new supply cuts from the OPEC+ group to counterbalance any potential decrease in demand due to the coronavirus outbreak. Oil prices fell to their lowest level in more than a year on Monday.
According to the market sources, the OPEC+ is considering lowering oil output by a further 500,000 bpd due to any potential decline in demand triggered by the coronavirus outbreak.
BP’s CFO said on Tuesday that the global economic slowdown due to China’s coronavirus outbreak is set to decrease oil demand this year by 300,000 to 500,000 barrels per day.
Goldman Sachs said that the virus outbreak’s impact on demand is likely to keep volatility in spot prices uplifted.
The U.S. EIA said in a monthly report on Friday (31st January) that U.S. crude production rose 203,000 barrels per day (bpd) to a record 12.9 million bpd in November.
The U.S. energy services firm Baker Hughes said in its report on Friday (31st January) that the U.S. energy firms last week decreased the number of rigs looking for new oil by 1 to 675 for the week ended 31st January.
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 31st January later today. Previously, the API reported that U.S. crude supplies fell by 4.267 million barrels for the week ended January 24. The EIA will report US crude inventories for the week ended January 31 on Wednesday. Previously, the EIA reported that U.S. crude inventories rose by 3.548 million barrels for the week ended January 24.
On the technical front, the RSI is currently at 29.97% and suggests that the market can move in the upward direction. The current price is below the MA5. The current price is below the middle line of the Bollinger bands but is heading upwards.
Overall Bias is Positive and short-term trades can be initiated with below mentioned Stop Loss and Profit targets.
Trade Suggestion-Limit Buy At 51.24 Take Profit At 51.94 Stop Loss At 50.89