Skip to content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Oil Price Forecast: US Crude Oil Price Action Indecisive Ahead of FOMC

Oil Price Forecast: US Crude Oil Price Action Indecisive Ahead of FOMC

Tammy Da Costa, Analyst

Oil Price Forecast:

Advertisement

WTI Crude Oil has continued to consolidate as bullish momentum appears to have stalled at a key area of resistance, marked by the 76.4% Fibonacci retracement level of the 2020 major move. Although OPEC appears to be on track regarding pledged oil output supply, the delay in both the US Fiscal Stimulus package and the Covid-19 vaccine rollout continue to hinder further progress on the long side.

Visit the DailyFX Educational Center to discover why news events are Key to Forex Fundamental Analysis

Meanwhile, this week’s major risk events include an array of data that may provide a catalyst for price action. With Consumer Confidence (reported earlier today) falling in-line with expectations, the Federal Reserve policy meeting (tomorrow), Q4 Adv GDP data (Thursday) and Core PCE results (Friday) will likely be the main drivers of the USD for the remainder of the week.

Oil Forecast
Oil Forecast
Recommended by Tammy Da Costa
Get Your Free Oil Forecast
Get My Guide

DailyFX Economic Calendar

With global lockdowns further weighing on Oil demand, prospects of additional US Fiscal stimulus combined with optimism regarding a vaccine rollout have weighed on the greenback, helping to keep US Crude Oil afloat.

WTI Technical Analysis

Currently WTI price action remains encapsulated by the channel formation that has provided support and resistance for the major commodity since November. Simultaneously, the 76.4% Fibonacci retracement mentioned above provides support at 5162.3 while the Moving Average Convergence Divergence (MACD) remains well above the zero line, indicating that the upward trend is still holding for the time being.

Understanding the Core Fundamentals of Oil Trading
Understanding the Core Fundamentals of Oil Trading
Recommended by Tammy Da Costa
Learn the Core Fundamentals of Oil Trading
Get My Guide

WTI – US Crude Oil Daily Chart

Chart prepared by Tammy Da Costa, IG

WTI - US Crude Oil Client Sentiment

Oil - US Crude Bullish
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily -4% 16% 3%
Weekly -22% 103% 3%
Learn how to use Sentiment in your trading strategy
Get My Guide

At the time of writing, Retail trader data shows 47.10% of traders are net-long with the ratio of traders short to long at 1.12 to 1. The number of traders net-long is 10.26% lower than yesterday and 7.94% lower from last week, while the number of traders net-short is 5.46% higher than yesterday and 1.28% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests Oil - US Crude prices may continue to rise.

Traders are further net-short than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger Oil - US Crude-bullish contrarian trading bias.

--- Written by Tammy Da Costa, Market Writer for DailyFX.com

Contact and follow Tammy on Twitter: @Tams707

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES