Home Forex Markets Heavy risks are intensive, and Brent crude oil continues to be under pressure

Heavy risks are intensive, and Brent crude oil continues to be under pressure

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Heavy risks are intensive, and Brent crude oil continues to be under pressure


OPEC+ members denied the rumors of increasing production and boosted by API inventory data. Brent crude oil closed up yesterday; EIA inventory data and the minutes of the Federal Reserve meeting may dominate the trend of Brent crude oil; the 90.00 psychological mark is still the key.

Brent Crude Oil Fundamental Background

Brent crude oil managed to post gains yesterday following a barrage of denials from OPEC+ members about a potential 5 million bpd production increase. In addition, the latest weekly inventory data from the American Petroleum Institute (API) recorded a better-than-expected performance, which also brought a certain degree of boost to oil prices. Data showed that U.S. API crude inventories fell by 4.8 million barrels in the week ended Nov. 18, more than expectations for a drop of 2.6 million barrels. The Fed’s Bullard (Bullard) previously made some impressive remarks. Ahead of his speech, most market participants expected him to reiterate previous hawkish rhetoric, but that was not the case, which largely kept the dollar on the defensive.

During the period, the economic calendar shows that the relevant data in the United States is relatively dense: including data such as durable goods orders and consumer confidence index, but the real focus of the market is the minutes of the Federal Reserve meeting. The market expects to get relevant information on the path of future rate hikes and any new information from it. From the perspective of crude oil, if the latest EIA crude oil inventory data in the United States records a similar performance to API inventory data, then Brent crude oil is expected to usher in a rise after the data is released.

economic calendar

Source: DailyFX Economic Calendar

More broadly, concerns over the coronavirus outbreak in China and the risk of a recession continued to weigh on crude oil prices. At the same time, the back and forth of the war also continued to put the oil market in a bind.

Brent Crude Oil Technical Analysis

Heavy risks are intensive, and Brent crude oil continues to be under pressure

Chart by Warren Venketas via IG

From the daily chart, the important psychological level of 90.00 may continue to put pressure on Brent crude oil. However, today’s fundamentals may invalidate this view.

key resistance level

key support level

IG Client Sentiment Indicator

The IG customer sentiment indicator shows that 84% of retail investors hold a net short position in crude oil, releasing a bullish signal for crude oil. At DailyFX, the IG Client Sentiment indicator is often used as a contrarian indicator, with retail investors bearish on crude oil, which means that oil prices are expected to rise. (Written by Warren Venketas and translated by Lisa)

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