This Week's CoT - Futures, Hedge Fund Buying

WTI crude oil: Currently net long 541k, up 2.8k.

Monday’s intraday drop below the 50-day moving average was bought, with a session low of $60.66. By Thursday, WTI ($63.58/barrel) ticked $65.47 – just past the daily upper Bollinger band. This helped take out the prior high of $64.38 from April 30, but this also pushed the crude into overbought territory.

The 50-day lies at $62.03. Before rallying in mid-April, WTI hugged the average for nearly a month, during which bids showed up at $58 several times.

Beginning May through July, OPEC+ is easing oil output cuts. Global recovery is taking hold, and this has encouraged the producers to roll back some of the production cut that was initiated last year. At the April 1 meeting, the group said it planned to bring 2.1 million barrels per day back to the market. Earlier, it cut output by around eight mb/d.

In the US, crude production in the week to April 23 dropped 100,000 b/d to 10.9 mb/d. Distillate stocks fell as well, down 3.3 million barrels to 139 million barrels. Refinery utilization increased four-tenths of a percentage point to 85.4 percent. Stocks of crude and gasoline, on the other hand, rose 90,000 barrels and 92,000 barrels to 493.1 million barrels and 235.1 million barrels respectively. Crude imports increased as well – up 1.2 mb/d to 6.6 mb/d.

E-mini S&P 500: Currently net long 2.3k, up 54.4k.

The streak of positive flows into US-based equity funds stopped at 11 weeks during which $107.6 billion was gained; in the week to Wednesday, $3.1 billion was withdrawn (courtesy of Lipper). In the same week, SPY (SPDR S&P 500 ETF), VOO (Vanguard S&P 500 ETF) and IVV (iShares Core S&P 500 ETF) lost $3.7 billion; before this, these ETFs took in $18.4 billion over five weeks (courtesy of ETF.com).

To be fair, this was before the S&P 500 (4181.17) rallied 0.7 percent on Thursday on the back of earnings results from Apple (AAPL) and Facebook (FB). Bulls’ mettle was nevertheless tested in that session. In the very first minutes, the large cap index gapped up 0.9 percent to score a new intraday high of 4218.78, before sellers showed up; by noon, it was down 0.2 percent, but bids showed up at the 10-day, with the session ending with a daily hanging man. Sellers are beginning to come out of the woodwork.

From up 0.9 percent at Thursday’s high, the S&P 500 ended the week flat.  A weekly gravestone doji appeared, having come after last week’s dragonfly doji. This took place even as non-commercials covered all their shorts and are now slightly net long.

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