Daily Analysis For WTI Crude (US Oil) 14-06-2023

Daily Analysis For WTI Crude (US Oil) 14-06-2023

WTI Crude Oil (US Oil) Analysis


Key Points: -


·       The price of WTI crude oil has surged beyond the $70.00 mark, driven by the prevailing optimism surrounding the Federal Reserve's neutral monetary policy stance.


·       According to the latest report published by the International Energy Agency (IEA), global demand for oil is projected to experience robust growth of 2.4 million barrels per day (bpd) this year, reaching a record high of 102.3 million bpd.


·       Market attention will be focused on the upcoming oil inventory data released by the United States Energy Information Administration (EIA) for the week ending June 09.


Today's Scenario: -


West Texas Intermediate (WTI) futures on the New York Mercantile Exchange (NYMEX) are currently testing levels above the significant resistance of $70.00 during the London session. The price of oil has received a boost as investors are hopeful that the Federal Reserve (Fed) will refrain from tightening its monetary policy. The Fed's decision will be announced at 18:00 GMT.


The US Dollar Index (DXY) has entered a bearish phase and is consistently hitting new intraday lows. At the time of writing, the DXY has reached a low of 103.16. The downward bias for the USD Index is gaining momentum as a neutral policy stance from the Fed would reduce the divergence in policies between the US and other central banks.


While the oil price is benefiting from expectations of a neutral policy stance, which would alleviate concerns of a potential recession in the United States, the prolonged contraction in US factory activity over the past seven months has dampened oil demand. However, if Fed Chair Jerome Powell announces a neutral policy stance, it would instill confidence and optimism among oil producers and market participants.


It is important for investors to consider that a hawkish guidance from the Fed cannot be completely ruled out, given that inflationary pressures are still below the desired rate of 2%.


Later this week, the European Central Bank (ECB) is set to announce its interest rate decision. ECB President Christine Lagarde is expected to further increase interest rates as the Eurozone economy is facing significant pressure from high inflation. Additional interest rate hikes by the ECB could negatively impact market sentiment.


Furthermore, the latest oil market report from the International Energy Agency (IEA) highlights that global oil demand is projected to grow by 2.4 million barrels per day (bpd) this year, reaching a record high of 102.3 million bpd. Between 2022 and 2028, global oil demand is expected to increase by 6% to reach 105.7 million bpd.


In addition to the Fed policy announcement, investors will closely monitor the weekly oil inventories data to be released by the US Energy Information Administration (EIA) for the week ending June 09.


Diagram of WTI Crude Oil (US Oil): -


Economic Events: -


Date      Event                                                                                            Impact        Currency

 02:00   (United States) API Crude Oil Stock Change                  Medium             USD

 04:15   (New Zealand) Current Account                                                  Medium NZD

 05:30   (New Zealand) Food Inflation YoY                                         Low NZD

 10:00   (Netherlands) Balance of Trade                                                          Low  EUR

 10:30   (Finland) Inflation Rate YoY                                                                 Low  EUR

 10:30   (Finland) Inflation Rate MoM                                                              Low  EUR

 10:30   (Finland) CPI                                                                                         Low     EUR

 11:30   (United Kingdom) GDP 3-Month Avg                                          Medium GBP

 11:30   (United Kingdom) Goods Trade Balance Non-EU                              High GBP

 11:30   (United Kingdom) Balance of Trade                                      Low GBP

 11:30   (United Kingdom) Construction Output YoY                       Low GBP

 11:30   (United Kingdom) Industrial Production YoY                       Low GBP

 11:30   (United Kingdom) Industrial Production MoM                            Medium             GBP

 11:30   (United Kingdom) Manufacturing Production YoY             Low GBP

 11:30   (United Kingdom) Manufacturing Production MoM    Medium            GBP

 11:30   (United Kingdom) Goods Trade Balance                                            High GBP

 11:30   (United Kingdom) GDP YoY                                                                 Low  GBP

 11:30   (United Kingdom) GDP MoM                                                             High  GBP

 11:30   (Germany) Wholesale Prices MoM                               Medium EUR

 11:30   (Germany) Wholesale Prices YoY                                  Medium EUR

 12:30   (China) FDI (YTD) YoY                                                                   Medium   CNY

 12:30   (Slovakia) Inflation Rate MoM                                                            Low  EUR

 12:30   (Slovakia) Inflation Rate YoY                                                                Low  EUR

 12:30   (Slovakia) Core Inflation Rate MoM                                      Low EUR

 12:30   (Slovakia) Core Inflation Rate YoY                                        Low EUR

 12:30   (Slovakia) CPI                                                                                      Low      EUR

 13:30   (France) IEA Oil Market Report                                                   Medium  EUR

 14:30   (Euro Area) Industrial Production MoM                                     Medium EUR

 14:30   (Euro Area) Industrial Production YoY                                              Low  EUR

 14:30   (Montenegro) GDP Growth Rate YoY                                                Low  EUR

 15:00   (Germany) 10-Year Bund Auction                               Medium  EUR

 15:30   (Portugal) Inflation Rate MoM                                                          Low    EUR

 15:30   (Portugal) Inflation Rate YoY                                                             Low    EUR

 15:30   (Portugal) CPI                                                                                     Low       EUR

 15:30   (Ireland) Residential Property Prices YoY                                          Low  EUR

 15:30   (Ireland) Residential Property Prices MoM                       Low EUR

 16:30   (United States) MBA 30-Year Mortgage Rate                Medium USD

 16:30   (United States) MBA Mortgage Applications                      Low USD

 16:30   (United States) MBA Mortgage Refinance Index                              Low USD

 16:30   (United States) MBA Mortgage Market Index                                  Low USD

 16:30   (United States) MBA Purchase Index                                                 Low  USD

 17:00   (United Kingdom) NIESR Monthly GDP Tracker                               Low GBP

 18:00   (Canada) New Motor Vehicle Sales                                     Low  CAD

 18:00   (United States) Core PPI MoM                                                  Medium    USD

 18:00   (United States) Core PPI YoY                                                             Low    USD

 18:00   (United States) PPI YoY                                                                      Low     USD

 18:00   (United States) PPI MoM                                                     High  USD

 20:00   (United States) EIA Heating Oil Stocks Change                                  Low USD

 20:00   (United States) EIA Refinery Crude Runs Change                              Low USD

 20:00   (United States) EIA Crude Oil Stocks Change               Medium USD

 20:00   (United States) EIA Distillate Stocks Change                      Low USD

 20:00   (United States) EIA Gasoline Production Change                             Low USD

 20:00   (United States) EIA Crude Oil Imports Change                                 Low USD

 20:00   (United States) EIA Gasoline Stocks Change                Medium USD

 20:00   (United States) EIA Cushing Crude Oil Stocks Change         Low              USD

 20:00   (United States) EIA Distillate Fuel Production Change         Low              USD

 21:00   (United States) 17-Week Bill Auction                                                 Low USD

 23:30   (United States) Fed Interest Rate Decision                          High              USD

 23:30   (United States) FOMC Economic Projections                        High              USD

 23:30   (United States) Interest Rate Projection - 1st Yr                           Medium            USD

 23:30   (United States) Interest Rate Projection - 2nd Yr                         Medium            USD

 23:30   (United States) Interest Rate Projection - Current        Medium            USD

 23:30   (United States) Interest Rate Projection - Longer                        Medium             USD


Buy Scenario: -


WTI Oil is currently experiencing an upward trend on Wednesday and is approaching the key level of 68.91 (PIVOT).


If the price manages to reclaim the level of 68.91, it would help stabilize the market following a significant decline earlier in the week. In such a scenario, if the upward momentum continues to build, we can anticipate a potential surge towards the near-term target of 73.15. Till we do not advise to buy in WTI US oil.


Selling Scenario: -


On the other hand, if the price fails to surpass the 68.91 level, it would indicate that sellers still hold control. This could potentially trigger a downward momentum, leading to further selling pressure and potentially driving the price towards the next major target at 65.20. Till we did not advise to sell WTI Crude oil.


Support and Resistance Level: -

 Support           Resistance  

 S1 67.85   -     R1 70.50

 S2 66.25  -      R2 71.56

 S3 65.20  -      R3 73.15


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