Image Source: Unsplash
 

• WTI crude futures are near $71 per barrel, facing a 1% decline in the previous session, influenced by concerns over demand in China, the top crude importer.
• China’s largest oil and gas producer, CNPC, lowered its 2023 crude demand estimate, contributing to the downward pressure on crude oil prices.
• Energy imports in China slightly decreased in May, while crude oil stockpiles reached a two-year high, adding to demand worries.
• Reports of indirect bilateral talks between the US and Iran raised concerns about a potential surge in Iranian crude exports, further impacting oil prices.
• OPEC+ voluntary output cuts, along with additional cuts by Saudi Arabia in July, provided support to oil prices, acting as a floor.
• Expectations of interest rate cuts in China and the pause in the US Federal Reserve’s tightening campaign brought optimism for the global economy and energy demand outlook.

Crude oil futures are trading slightly higher, up by approximately 0.1% around $71.30 per barrel. The market is currently in a balanced price range, and traders are using extreme levels to analyze rotational scenarios across different timeframes, from weekly to daily and short-term perspectives.

Yesterday’s closing saw an outside bar pattern, which often indicates a potential change in the market context. In this case, it suggests a shift from a rotational upward behavior to a possible downside bias.

The median-term calculations point to a mixed session, with positive volatility potentially impacting market sentiment. However, longer-term negative volatility is seen as a bullish factor for oil prices.

The volume profile structure from yesterday’s session indicates a likelihood of balance, with two low volume areas that could attract market participants. The market is currently trading around the prior point of control (POC) close level.

In terms of strategic trading, the market opened within the prior value-weighted average price (VWAP) close area, indicating that investors are awaiting a test of extremes to determine rotational scenarios. The prior VWAP close level is considered a level of support and buying interest at the moment. The focus is on targeting swing lows for absorption purposes.

1 Month Ago

In the managed money sector, there has been an increase in net short positions over the past several weeks, while net positions have decreased. As of June 13, new short positions of approximately 19.175 were established.

More By This Author:

US Stock Futures Flat As Market Takes A Pause From Previous Rally
Chinese Stock Market Slips As Investors Await PBOC’s Loan Prime Rate Decision
US Stock Futures Hold Steady As Interest Rate Pause Sparks Optimism