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• WTI crude futures maintained stability at approximately $80 per barrel on Tuesday, with the absence of significant market-moving signals. Market participants eagerly await forthcoming economic reports from the US and China, seeking insights into the energy demand outlook of the world’s two largest oil consumers.
• The evaluation of the monetary policy direction in the US persisted, following the Federal Reserve’s assertion that potential interest rate increases remain on the table should inflationary pressures persist.
• The market’s attention is now directed toward crucial US employment and inflation data scheduled for release during the week, alongside manufacturing PMI figures from both the US and China.
• Oil prices continue to be supported by production cuts implemented by OPEC+ members Saudi Arabia and Russia, thereby providing a supply-side underpinning. However, concerns linger over the potential easing of US sanctions on Iran and Venezuela, adding a note of uncertainty.

Technical Perspective of WTI Crude Oil

Crude oil is experiencing a 0.6% increase, trading around $80 per barrel. This rise can be attributed to a combination of buyer interest, short covering, and absorption that have propelled the market upward after a dip below the prior session’s lows. Notably, the volume profile structure from the previous session’s b-shaped pattern suggests a bullish undertone, which contrasts with the p-shaped structure seen today, potentially indicating a bearish bias for the upcoming session.

On the daily interval, there’s a potential for a balanced price range to form around the upper value extreme of the Year. This is due to core buying activity that seems to have emerged, possibly driving the market toward the early August high. However, any attempts to push prices above today’s and prior session’s highs might encounter selling pressure, leading to a potential pullback towards the lower extreme.

The dollar is slightly lower for the session, providing support along with negative volatility, which gives this session a bullish bias. Long-term volatility suggests a potential bullish influence on oil prices, while the median-term perspective offers mixed signals, indicating a balanced approach that depends on the news stream. Although the short-term lower dollar is supportive, the longer-term dollar perspective could exert pressure, suggesting a possible rotational viewpoint.

Weekly data reported up to August 22, which includes both Options and Futures combined, indicates money managers building net short positions while liquidating long ones. This stance leans towards a bearish viewpoint from the managed money sector. The current options landscape for the contract indicates a greater interest in the call’s first standard deviation area relative to the current price.

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