United States Oil (USO) fuel stockpiles offsets a surge in crude inventories
Oil prices were mixed in choppy trade on Wednesday, after government data showed a surge in weekly U.S. crude stockpiles that was partly offset by a drop in the nation’s inventories of refined fuel.
A drop in U.S. equity indexes also weakened sentiment in crude prices.
U.S. West Texas Intermediate crude futures settled 34 cents lower at $56.22 per barrel, off a session low at $55.42. International Brent crude futures up 11 cents at $65.97 per barrel around 2:30 p.m. ET.
U.S. crude inventories rose by 7.1 million barrels in the week ending March 1, the U.S. Energy Information Administration reported. That compared with analysts’ expectations for a modest increase of 1.2 million barrels in a Reuters poll.
Meanwhile, the nation’s gasoline inventories fell by 4.2 million barrels and stocks of distillate fuel including diesel were down 2.4 million barrels.
“A big rebound in U.S. crude oil imports, combined with a drop in exports led to the large increase in domestic inventories,” said David Thompson, executive vice president at Powerhouse, an energy-specialized commodities broker in Washington. “Demand for refined products remains decent.”
Crude futures also tracked a slump in U.S. equities, which sputtered without positive developments in trade talks between Washington and Beijing.
OPEC and its allies pledged to curb output by 1.2 million barrels per day, and they are likely to push back their decision whether or not to extend the output cut agreement to June from April, according to sources.
Meanwhile, the market is looking for further signs that the United States and China are making progress in talks to resolve their trade conflict.
U.S. Secretary of State Mike Pompeo said President Donald Trump would reject any trade deal that is not perfect, but added the White House would keep working on an agreement.
Overall, the bias in prices is: Upwards.
Note: this chart shows extraordinary price action to the upside.
By the way, prices are vulnerable to a correction towards 11.55.
The projected upper bound is: 12.42.
The projected lower bound is: 11.17.
The projected closing price is: 11.79.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 33 white candles and 17 black candles for a net of 16 white candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 47.0589. This is not an overbought or oversold reading. The last signal was a sell 7 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 55.60. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 47 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -31. This is not a topping or bottoming area. The last signal was a sell 7 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 3 period(s) ago.
Rex Takasugi – TD Profile
UNTD ST OIL FUND closed down -0.070 at 11.750. Volume was 16% below average (neutral) and Bollinger Bands were 44% narrower than normal.
Open High Low Close Volume___
11.710 11.789 11.580 11.750 25,802,168
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 11.79 11.04 13.05
Volatility: 30 37 39
Volume: 21,079,444 25,936,240 25,234,050
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
UNTD ST OIL FUND is currently 9.9% below its 200-period moving average and is in an downward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of USO at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on USO and have had this outlook for the last 2 periods.
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