Crude Oil Lifted By Restriction Easing Hopes In China

Photo by Timothy Newman on Unsplash

Crude oil is up by about 1.5% and trades around $78 in the New York trading session as investors hoped that China would ease some of the Covid restrictions.

  • OPEC+ could keep its output level unchanged.
  • China would like to bolster vaccination among its seniors and avoid stronger restriction and might consider a softer reopening with hopes for better demand which boosted prices slightly.
  • OPEC might consider not changing the current output which have been seen as bearish from investors while the cartel announced a 2 million barrel per day production reduction which was bullish for the market.

The daily interval found some buyers around the monthly key levels which brought the market to a close with gains of about 1.3% in yesterday’s session. Today’s weaker dollar was supported while it bounced back to pressure commodities again. 

The intraday perspective started with an imbalanced market behavior to the upside in the Asian trading session. In European trading, the market seemingly found selling pressure or long liquidations around the upper-value extreme of the day which let the market drop towards the lower-value extreme in New York trading. Currently, core sellers might add or re-enter their positions around the developing VWAP to target swing lows or even the prior VWAP close level as the data stream points to a bearish bias.

The VWAP perspective on the daily interval trades below the Year’s and Quarter’s developing value with an imbalanced market to the downside and may target the decade’s VWAP. However, the forecast is pointing to the upside, according to algorithm calculations and analyst estimates.

Money managers were net selling about 20,119 contracts of WTI Crude oil as of November 22nd COT data. Mainly long liquidations combined with new short positions might give the market a bearish stance from the managed money sector.

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