Oil drops sharply on mounting oversupply worries

January 6, 2016

The sentiment around the oil markets was hit badly this Wednesday, and the prices resumed the broader downtrend amid persisting supply glut worries ahead of the weekly EIA report

Brent hits 11-yr low, WTI falls to 2-week low 

Currently, WTI drops -1.29% to 35.50, while the Brent oil plunges nearly 2% to 35.75 levels, retreating slightly from fresh 11-year low struck at $ 35.53. Oil prices wiped-out corrective gains and fell back in the negative territory as rising supply worries overshadow the ongoing tensions between Saudi Arabia and Iran. 

According to a Reuters poll of eight analysts, in the United States, concerns over mounting stock levels were ongoing, with crude inventories likely to have risen by 439,000 barrels last week.

Moreover, strengthening greenback across the board ahead of the FOMC minutes, adds further to the downside in the oil prices. The US dollar trades near one-month highs at 99.60, up 0.12% on the day.

Markets now await the US EIA weekly inventory report due later in the NY session for further moves on the black gold. Markets are predicting a rise of about 133,000 for last week.

WTI Oil Technical Levels

WTI oil has an immediate resistance which stands at 37/37.10 (round number/ Jan 5 High) above which gains could be extended to 37.71/79 (daily R2/ Dec 31 High). While to the downside, the immediate support is at 35 levels below which the prices could drop to 34.63 (Dec 17 Low) levels. 

Publication source
OctaFX information  OctaFX reviews

January 23, 2017
The Week ahead: Politics to take center stage
Donald Trump is finally in power, a new era has arrived, and his policy plans in the first couple of weeks will override fundamentals. Markets spent more than two months pricing in growth policies promises, lowers corporate taxes, and deregulations, now it is time to deliver as markets will no more move on words but actions...
January 23, 2017
Dollar opens weak as markets cautious on the new Trump administration
The U.S. dollar continued to extend the declines for what could a third consecutive day. On Friday, Donald Trump took office as the 45th President of the United States...
January 20, 2017
The dollar has settled moderately lower
Asian stock markets were mixed overnight, after U.S. and European shares closed in the red Thursday. Japan and mainland China bourses managed to move higher (Chinese GDP beat expectations at 6.8%)...

EXNESS Rating
Tickmill Rating
 FXTM Rating
Orbex Rating
Larson&Holz IT Ltd Rating
FIBO Group Rating

OptionRally Rating
Binary.com Rating
Dragon Options Rating
UKoptions Rating
GTOptions Rating
OptionFair Rating