OPEC will hold the next meeting in Vienna on 30th Nov, discussing about further details regarding output freeze. Due to the market expectations on the likely agreement after the meeting, oil price has rebounded since 14th Nov, after testing the long term significant support line at 43.00. From 14th to 22nd Nov, WTI spot has rebounded 8.86%, trading above the downside uptrend line support.
Fundamentally, the oversupply issue has intensified. According to the monthly report from IEA (International Energy Agency), the output of OPEC in Oct has reached a record high of 33.83 million barrels per day. This figure has surpassed OPEC’s freeze target of 32.5 – 33.0 million barrels per day.
The conflicts of interests between member states is another major difficulty for reaching an unanimous agreement.
The firming of the dollar has restrained the bullish momentum.
If there is no concrete agreement made after the Vienna meeting, then oil prices will likely see a sharp and substantial fall. Nevertheless, before the release of the outcome, the market expectations will likely provide a support to the oil price.
Keep an eye on the EIA Crude Oil Inventories figure, to be released at 15:30 GMT today, it will make an impact on oil prices.
The daily Stochastic Oscillator is above 80, suggesting a retracement.
The current major support line is at 47.50, where the 50 SMA situates.
The near term major resistance zone is between 49.00 – 50.00.
The resistance level is at 48.50, followed by 49.00 and 49.50.
The support line is at 48.00, followed by 47.50 and 47.00.