Market news
09.08.2023, 17:16

WTI Price Analysis: WTI jumps to multi-month amid tighter global supply and Chinese stimulus hopes

  • WTI jumped to its highest level since November 2022 above $84.00.
  • Tighter global supply and Chinese inflation data are fuelling Oil prices.
  • EIA Oil stocks data came in higher than expected.

On Wednesday, the West Texas Intermediate (WTI) rose to a high of $84.15, it highest level since mid-November 2022 and then settled around $83.00. Tighter global supplies on the prospects of further Saudi production cuts and deflation evidence in China, which sparked expectations of more aggressive Chinese fiscal policies, explain those upwards movements. 

China reported that the Consumer Price Index (CPI) from July came in at -0.3% YoY vs -0.4% expected, while the Producer Price Index (PPI) set a 4.4% yearly decrease in the same month, higher than the 4.1% expected. According to TD Securities analysts, evidence of deflation in the Asian gigant fueled hopes of “bazooka-like” fiscal stimulus packages to bolster the local economy. In that sense, further stimulus would raise Oil demand, and as China is the largest importer in the world, the prices rise.

In addition, Saudi’s voluntary production cuts and Russia's export curtailment contribute to a tighter global supply, favouring black gold’s price.

On the data front, the EIA (Energy Information Administration) Crude Oil stockpiles report, which gives a weekly measure of the change in the number of barrels in stock of crude Oil and its derivates, came in at 5.85M in the first week of August, higher than the 0.567M expected.


WTI Levels to watch

The technical outlook for the WTI is bullish for the short term, but indicators flash overbought conditions, suggesting that a technical correction may be on the horizon. The Relative Strength Index (RSI) indicates overbought conditions as it points north above the 70 threshold, while the Moving Average Convergence (MACD) histogram displays increasing green bars. Additionally, the pair is above the 20,100,200-day SMAs, highlighting the continued dominance of bulls on the broader scale.

Support levels: $82.00,$80.00, $79.20 (20-day SMA).

Resistance levels: $84.00, $85.00, $87.00.

 

WTI Daily chart

 

© 2000-2024. All rights reserved.

This site is managed by Teletrade D.J. LLC 2351 LLC 2022 (Euro House, Richmond Hill Road, Kingstown, VC0100, St. Vincent and the Grenadines).

The information on this website is for informational purposes only and does not constitute any investment advice.

The company does not serve or provide services to customers who are residents of the US, Canada, Iran, The Democratic People's Republic of Korea, Yemen and FATF blacklisted countries.

AML Website Summary

Risk Disclosure

Making transactions on financial markets with marginal financial instruments opens up wide possibilities and allows investors who are willing to take risks to earn high profits, carrying a potentially high risk of losses at the same time. Therefore you should responsibly approach the issue of choosing the appropriate investment strategy, taking the available resources into account, before starting trading.

Privacy Policy

Use of the information: full or partial use of materials from this website must always be referenced to TeleTrade as the source of information. Use of the materials on the Internet must be accompanied by a hyperlink to teletrade.org. Automatic import of materials and information from this website is prohibited.

Please contact our PR department if you have any questions or need assistance at pr@teletrade.global.

Bank
transfers
Feedback
Live Chat E-mail
Up
Choose your language / location