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Crude Oil Price to Remain Capped on Strategic Reserve Release Talk

Crude Oil Price to Remain Capped on Strategic Reserve Release Talk

Nick Cawley, Senior Strategist


What's on this page

Crude Oil Price, Chart, and Analysis

  • US President looking for coordinated action on oil stockpiles.
  • Crude oil will remain capped as discussions continue.
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The President of the United States, Joe Biden, is having ongoing talks with China, India, and Japan about a coordinated release of oil stockpiles to help push back against the high cost of oil that is dampening global growth prospects and fueling inflation. The US has already indicated that it is willing to release some of its reserves and now wants other large consumer countries to follow its path. The price of oil has been on a one-way path higher since the pandemic slump in early 2020 and the recent news about a potential release of oil stockpiles will likely cap any further upside in the short- to medium-term.

US Crude Oil Monthly Price Chart November 19, 2021

The daily US crude oil chart shows the multi-month uptrend broken convincingly earlier this month and a set of lower highs and lower lows printed since late October. US crude has posted seven bearish candles in a row, excluding the weekend candle, since rejecting trend support on November 10 and has broken below the 20- and 50-day simple moving averages. While the current chart set-up suggests lower prices ahead, the CCI indicator warns that oil is currently oversold and this indicator needs to move back into the neutral zone before downside price action resumes.

US Crude Oil Daily Price Chart November 19, 2021

US Crude Retail trader data show 61.21% of traders are net-long with the ratio of traders long to short at 1.58 to 1.The number of traders net-long is 11.90% higher than yesterday and 22.38% higher from last week, while the number of traders net-short is 9.60% lower than yesterday and 4.42% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests US Crude prices may continue to fall. Traders are further net-long than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger US Crude bearish contrarian trading bias.

Oil - US Crude Bullish
Data provided by
of clients are net long. of clients are net short.
Change in Longs Shorts OI
Daily -8% 9% -3%
Weekly -9% -9% -9%
What does it mean for price action?
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What is your view on Oil – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1.

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