WTI Price Analysis: WTI Retreats Towards $79.00 Ahead Of Fed Decision
The West Texas Intermediate (WTI) barrel trades soft on Wednesday as markets await the Federal Reserve (Fed) decision. In addition, the Energy Information Administration (EIA) reported a lower-than-expected decline in inventories in the week ending on July 21 and seem to be weighing on Oil prices.
On the other hand, the USD as per the DXY Index is declining, and US Treasury yields are decreasing ahead of the Federal Reserve's (Fed) announcement later in the session. Markets have already priced in a 25 basis point (bps) increase but are placing bets on a low likelihood of a similar increase in September (20%) and November (45%), respectively. Investors will need to model their expectations for the upcoming meetings based on the messaging regarding forward guidance since there won't be an updated macro forecast or dot plot. Its worth noticing that higher rates tend to cool down economic activity so the bets as to what the Federal Reserve will do following the decision may affect the WTI price dynamics.
On a positive note, the announcement on Tuesday that the Chinese government is to step up economic stimulus to bolster economic activity could provide support to the WTI as China is the largest Oil importer in the world, so a stronger economic activity would imply a greater Oil demand.
WTI Levels to watch
The daily chart of the WTI suggest a neutral to bullish outlook for the short term as buyers seem to be losing steam. The Relative Strength Index (RSI) has a neutral slope near the overbought threshold, while the Moving Average Convergence Divergence (MACD) printed a lower green, implying that the bulls are losing steam.
Resistance levels: $80.00,$81.00,$82.60.
Support levels: $76.70 (200-day SMA), $74.59 (20-day SMA),$73.50 (100-day SMA).
WTI Daily chart
(Click on image to enlarge)
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WTI US OIL
| OVERVIEW | |
|---|---|
| Today last price | 79.13 |
| Today Daily Change | -0.10 |
| Today Daily Change % | -0.13 |
| Today daily open | 79.23 |
| TRENDS | |
|---|---|
| Daily SMA20 | 73.99 |
| Daily SMA50 | 72.21 |
| Daily SMA100 | 73.49 |
| Daily SMA200 | 76.61 |
| LEVELS | |
|---|---|
| Previous Daily High | 79.78 |
| Previous Daily Low | 78.19 |
| Previous Weekly High | 77.23 |
| Previous Weekly Low | 73.78 |
| Previous Monthly High | 74.36 |
| Previous Monthly Low | 66.95 |
| Daily Fibonacci 38.2% | 79.18 |
| Daily Fibonacci 61.8% | 78.8 |
| Daily Pivot Point S1 | 78.35 |
| Daily Pivot Point S2 | 77.48 |
| Daily Pivot Point S3 | 76.77 |
| Daily Pivot Point R1 | 79.94 |
| Daily Pivot Point R2 | 80.65 |
| Daily Pivot Point R3 | 81.53 |
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