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Crude Oil Market Under Short Covering; Support Seen At 3413

By CommodityOnline (Commodity Online)CommoditiesJan 09, 2019 12:22
in.investing.com/analysis/crude-oil-market-under-short-covering-support-seen-at-3413-200207007
Crude Oil Market Under Short Covering; Support Seen At 3413
By CommodityOnline (Commodity Online)   |  Jan 09, 2019 12:22
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Technically Crude Oil market is under short covering as market has witnessed drop in open interest by 17.49% to settled at 15938 while prices up 32 rupees.

Now MCX Crude Oil is getting support at 3413 and below same could see a test of 3351 levels and resistance is now likely to be seen at 3525, a move above could see prices testing 3575.

Crude Oil on MCX settled up 0.93% at 3474 supported by a report that Saudi Arabia is planning to cut crude exports to around 7.1 million barrels per day (bpd) by the end of January. However, concerns of a worldwide economic slowdown were cited as a headwind for oil prices as investors fear it would dent fuel consumption.

Looking at oil supplies, 2019 crude prices have been supported by supply cuts from a group of producers around the Middle East-dominated Organization of the Petroleum Exporting Countries (OPEC) as well as non-OPEC member Russia.

Looming over the OPEC-led cuts, however, is a surge in U.S. oil supply, driven by a steep rise in onshore shale oil drilling and production. As a result, U.S. crude oil production rose by a whopping 2 million barrels per day (bpd) last year to a world record 11.7 million bpd. With drilling activity still high, most analysts expect U.S. oil production to rise further this year.

There is also concern that a worldwide economic slowdown will dent fuel consumption, resulting in a reduction of bullish positions the hedge fund industry holds in crude futures.

State newspaper China Daily said that Beijing is keen to put an end to its trade dispute with the United States, but that it will not make any "unreasonable concessions" and that any agreement must involve compromise on both sides.

Trading Ideas:
--Crude Oil trading range for the day is 3351-3575.
--Crude oil prices were supported by a report that Saudi Arabia is planning to cut crude exports to around 7.1 million barrels per day (bpd) by the end of January.
--However, concerns of a worldwide economic slowdown were cited as a headwind for oil prices as investors fear it would dent fuel consumption.
--Looming over the OPEC-led cuts, however, is a surge in U.S. oil supply, driven by a steep rise in onshore shale oil drilling and production.

Crude Oil Market Under Short Covering; Support Seen At 3413
 
Crude Oil Market Under Short Covering; Support Seen At 3413

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