Daily Analysis For WTI Crude (US Oil) 25-05-2023

Daily Analysis For WTI Crude (US Oil) 25-05-2023

WTI Crude Oil (US Oil) Analysis
Key Points
• WTI crude oil is experiencing volatility as it hovers near its highest levels in over three weeks, facing challenges in extending its three-day upward trend.
• The Weekly Crude Oil Stock Change report from the Energy Information Administration (EIA) revealed a significant and unexpected draw in inventories on May 19, which had a notable impact on the market.
• While the US Dollar benefits from the market's risk aversion sentiment, it fails to provide a clear explanation for the indecisiveness observed among policymakers at the Federal Reserve (Fed).
• Moving forward, the key determinants of short-term oil price movements will be the various risk catalysts present in the market.

Today's Scenario: - During the early hours of Thursday's Asian session, WTI crude oil remains on the defensive above the $74.00 level, following its recent climb to a three-week high. The price movement of the black gold can be attributed to a combination of mixed factors related to oil inventories and the US Dollar.
The significant draw in weekly inventory levels, as reported by the Energy Information Administration (EIA), contributed to the recent surge in the energy benchmark. The EIA Crude Oil Stocks Change revealed a substantial draw of -12.456 million barrels, surpassing market expectations of 0.775 million barrels and the previous reading of 5.04 million barrels.
In addition to the positive impact of the EIA inventories report, warnings from Saudi Arabia have further supported the upward movement in WTI prices. The country's energy minister cautioned short-sellers who are betting on a decline in oil prices, suggesting that they should be prepared for potential losses.

Diagram of WTI Crude Oil (US Oil)
WTI  Crude Oil
Economic Events: -
00:01(United Kingdom) Car Production YoYLowGBP
00:50(Japan) Foreign Bond InvestmentLowJPY
00:50(Japan) Stock Investment by ForeignersLowJPY
01:00(Australia) RBA Payments System Board MeetingLowAUD
04:35(Japan) 40-Year JGB AuctionLowJPY
07:00(Germany) GDP Growth Rate QoQMediumEUR
07:00(Germany) GDP Growth Rate YoYMediumEUR
07:00(Germany) GfK Consumer ConfidenceHighEUR
07:45(France) Business ConfidenceMediumEUR
07:45(France) Business Climate IndicatorLowEUR
08:00(Spain) PPI YoYLowEUR
09:30(Slovenia) Tourist Arrivals YoYLowEUR
09:30(Slovenia) Business ConfidenceLowEUR
10:00(Euro Area) ECB Annual Report 2022LowEUR
10:00(Euro Area) ECB Guindos SpeechHighEUR
10:10(Italy) BTP Short TermLowEUR
11:00(United Kingdom) CBI Distributive TradesMediumGBP
11:00(Latvia) Unemployment RateLowEUR
12:00(Canada) CFIB Business BarometerLowCAD
13:30(Canada) Manufacturing Sales MoMLowCAD
13:30(United States) Jobless Claims 4-week AverageHighUSD
13:30(United States) Continuing Jobless ClaimsHighUSD
13:30(United States) Initial Jobless ClaimsHighUSD
13:30(United States) Chicago Fed National Activity IndexMediumUSD
13:30(United States) Real Consumer Spending QoQLowUSD
13:30(United States) GDP Sales QoQLowUSD
13:30(United States) Core PCE Prices QoQLowUSD
13:30(United States) PCE Prices QoQLowUSD
13:30(United States) GDP Price Index QoQMediumUSD
13:30(United States) Corporate Profits QoQMediumUSD
13:30(United States) GDP Growth Rate QoQMediumUSD
13:30(Canada) Average Weekly Earnings YoYLowCAD
15:00(United States) Pending Home Sales YoYMediumUSD
15:00(United States) Pending Home Sales MoMMediumUSD
15:30(United States) EIA Natural Gas Stocks ChangeLowUSD
15:30(United States) Fed Collins SpeechMediumUSD
16:00(United States) Kansas Fed Composite IndexLowUSD
16:00(United States) Kansas Fed Manufacturing IndexLowUSD
16:30(United States) 8-Week Bill AuctionLowUSD
16:30(United States) 4-Week Bill AuctionLowUSD
17:30(United Kingdom) BoE Haskel SpeechLowGBP
18:00(United States) 7-Year Note AuctionLowUSD
23:00(New Zealand) ANZ Roy Morgan Consumer ConfidenceLowNZD

Buy Scenario: - WTI prices continued their upward momentum and surpassed the $74.00 per barrel level on Wednesday, extending their multi-session advance. This increase was supported by the growth in both open interest and trading volume, indicating the potential for further upward movement in the short term. However, the next challenge for WTI lies at the provisional 100-day Simple Moving Average (SMA) around $76.00 per barrel, which could serve as a resistance level. Till we do not advise to buy in WTI US oil.

Selling Scenario: - WTI oil experienced a retreat in response to the latest Energy Information Administration (EIA) report, which revealed a significant decline of 12.5 million barrels in crude inventories compared to the previous week. However, the increase in domestic oil production from 12.2 million barrels per day (bpd) to 12.3 million bpd acted as a bearish factor for WTI oil. Till we did not advise to sell WTI Crude oil.

Support and Resistance Level: -
S1 73.32-R1 74.90
S2 72.43-R2 75.59
S3 71.74-R3 76.48


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