Latest Commitment Of Traders Report - Noncommercial Positions

WTI crude oil: Currently net long 560.3k, down 1.7k.

OPEC+, consisting of 13 OPEC members and a group of 10 Russia-led producers, agrees to raise crude production by 500,000 barrels a day in January. This can be interpreted as a vote of confidence on their part that oil demand will firm up next year.

The price of crude has recovered massively from April when Brent dropped as low as $15.98/barrel and WTI $6.50. Intraday Friday, the latter tagged $46.68.

Ahead of this, WTI ($46.26) drew sellers at $42-$43 for over four months. It broke out two weeks ago. This Wednesday, the breakout was just about tested, with the crude touching $43.92 intraday. That dip was bought. As long as this resistance-turned-support draws bids, bulls have a shot at $49-$50.

In the meantime, US crude production rose 100,000 b/d to 11.1 million b/d in the week to November 27. The EIA report also showed crude imports increased 171,000 b/d to 5.4 mb/d. Stocks of gasoline and distillates rose as well – up 3.5 million barrels and 3.2 million barrels to 233.6 million barrels and 145.9 million barrels, in that order. Refinery utilization dropped five-tenths of a percentage point to 78.2 percent. Crude stocks, however, declined 679,000 barrels to 488 million barrels.

E-mini S&P 500: Currently net short 24.4k, up 11k.

Another $7.2 billion moved into US-based equity funds in the week to Wednesday. This was the fourth straight weekly inflows for a cumulative $39.8 billion (courtesy of Lipper). In the same week, courtesy of ETF.com, SPY (SPDR S&P 500 ETF), VOO (Vanguard S&P 500 ETF) and IVV (iShares Core S&P 500 ETF) collectively lost $3.7 billion, but this has to do with VOO that saw $7 billion redeemed on Wednesday alone; otherwise, it would have been an up week.

The S&P 500 made three intraday highs this week – 3678.45 on Tuesday, 3682.73 on Thursday and 3699.20 on Friday. Despite signs of fatigue for a month now and the daily in gross overbought territory, the large cap index (3699.12) remains above both 3640s and 3580s.

Post-Pfizer news on November 9, the S&P 500 gapped up, posting a new intraday high of 3645.99 but only to give back most of its gains to close the shooting star session at 3550.50. Earlier on September 2, the index retreated after printing 3588.11. On Monday, early weakness was bought at 3590s. Then on Tuesday and Wednesday, 3640s was defended. As long as bulls successfully defend these levels, they deserve the benefit of the doubt. A failure to do so can negatively impact investor sentiment, which is excessively bullish (more on this here).

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