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.

Free Trading Guides
Oil - US Crude
Wall Street
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • The price of #gold may continue to exhibit a bullish behavior in June as the pullback from the yearly high ($1765) reverses ahead of the May low ($1670). Get your Gold market update from @DavidJSong here: https://t.co/OeaYtCpcIo https://t.co/UQVPIVCTCP
  • The $USD breakdown has taken the index into confluence support at the objective yearly open. Get your USD technical analysis from @MBForex here: https://t.co/A16XEv6n4d https://t.co/GzEp3gCAe5
  • US equities continue to run higher with the Nasdaq 100 setting a fresh all-time-high, not even three months after giving back almost a third of its value in about a month. Get your #Nasdaq technical analysis from @JStanleyFX here: https://t.co/1LI54uvI8x https://t.co/e9FvSLqfaA
  • The US Dollar may be at risk to losses against some of its #ASEAN counterparts. USD/SGD, USD/PHP, USD/MYR and USD/IDR have recently broken to the downside. Will losses continue? Find out from @ddubrovskyFX here: https://t.co/0RTlj6maTT https://t.co/UyQ4i0AihI
  • The British Pound technical outlook still seems to favor the downside. GBP/CAD may pressure key rising support from August as GBP/AUD could prolong its downtrend. GBP/CHF may fall. Get your $GBP market update from @ddubrovskyFX here: https://t.co/hBOpDKXmfW https://t.co/AJlT2YKeCu
  • USD/JPY is approaching medium-term uptrend resistance and while the outlook remains constructive, the advance may be vulnerable near-term while below confluence resistance. Get your $USDJPY technical analysis from @MBForex here: https://t.co/93D7AyhHtG https://t.co/KQcLLrkMP3
  • AUD/USD has had the most impressive show of trend over the past couple of months with the pair gaining almost 1500 pips from the March low. Get your $AUDUSD technical analysis from @JStanleyFX here: https://t.co/vLz4Rpln3u https://t.co/AOwnJja5V8
  • Has the #Euro been saved? Find out from @CVecchioFX here: https://t.co/eiXfOTyGa6 https://t.co/AyRiYpb4cN
  • U.S. Market Analyst at https://t.co/JsVsSmefgR, Shain Vernier covers - ✔️ Safe haven assets in volatile markets ✔️ Central banks and governments ✔️ How will commodities trade in a recession Only on Trading Global Markets Decoded #podcast. Tune in here: https://t.co/1UmEzEbwiy https://t.co/ygwjGNvS61
  • The $USD, Euro, British Pound and Australian Dollar will all be at the mercy of political developments in Asia, Europe and North America this week. An avalanche of PMI data will set the backdrop. Find out from @ZabelinDimitri here: https://t.co/L8cfAgVx94 https://t.co/THWhPAS6AM
Crude Oil Price Forecast: Round 2 Of Harvey May Knock Oil Bulls Out

Crude Oil Price Forecast: Round 2 Of Harvey May Knock Oil Bulls Out

2017-08-30 16:40:00
Tyler Yell, CMT, Currency Strategist


  • Crude Oil Technical Strategy: watching last week’s low at $45.38 as key support
  • Refining capacity was cut by ~20-30% due to hurricane Harvey
  • US Crude inventories fell 5.39m barrels per EIA, next week numbers expected to be ugly for Bulls
  • IGCS Sentiment highlight: Subtle rise in long positions provides contrarian signal to look for upside

Are you confused why Oil is trading lower after an encouraging EIA Crude Oil Inventory Report that showed a draw of 5.39m barrels and had refiners processing 1m bpd more than last year’s record refining activity? In a word, or name, Harvey is why Oil is trading lower, and you can see the confusion through derivative markets such as time spreads of Oil and the Brent/ WTI spread.

Either way, the supply chain component of the energy market that was hurt by Harvey was refiners. What you need to know is that refiners were the demanding so much Oil from producers that the massive amount of production, the production that has thwarted OPEC’s best-laid plans to bring global stock pils back to the five-year average, and now that demand is stemmied. Even last week, as evidence was building that hurricane Harvey was going to be a force unlike Texas and refiners along the Gulf of Mexico had seen in a while, refiners were processing record amounts in order to put as much into inventory as possible for when they may be forced offline for prepares.

If you have heard of the adage, some some for a rainey day, the refiners put that saying to practical use and they were a key reason for the 5.39m barrel draw of US Crude Inventories. Now, next week is expected to be ugly, and we could see multiple weeks of large inventory builds. Either way, as markets often do, they are discounting today’s good EIA Crude Oil Inventory Report in preparation for a rough batch ahead. Another aligning factor is that seasonal demand is about to swing lower.

For a helpful reference point, in 2005, the Gulf of Mexico (where American’s refiners are concentrated) were hit by Hurricane Katrina and Ike at the same time of year (hurricane season) as seasonal demand (from summer travel) was decling. From late August to November, Crude Oil traded lower by ~18%. While it’s unwise to say yesterday = tomorrow, it’s worth noting we have seen someing like this before, and it did not end well for Crude Oil Bulls.

Give the strong rise in Crude Oil since Q3 began, click here to see the opportunities we’re watching in Oil.

Looking at the charts, here’s the level that has my attention, $45.38. $45.38 was the late July low and breakdown below this level would open up the argument that we’re seeing a continuation lower of the 2017 bearish trend in Oil. The support on such a breakdown would favor targeting $43.68 (early July low), and $42.08, the YTD low. A break below $42.08 would open up concerns that we’re about to enter a painful new era of lower-for-longer oil prices that will put downward pressure on inflation and likely increase rhetoric from OPEC to extend production cuts.

The resistance level that has my attention is $48.16, which is the top of the corrective pattern before the Harvey was made known to be the monster it was. A break and close above $48.16, regardless of the reason would provide hope, against reason, that the Bulls may see $50 again this year. However, when combining the seasonal, sentiment, and fundamental picture, it’s hard to hold out hope without proof.

JoinTyler in hisDaily Closing Bell webinars at 3 pm ETto discuss tradeable market developments.

Crude Oil continuing rebound from $45.38, last week’s low

Crude Oil Price Forecast: Round 2 Of Harvey May Knock Oil Bulls Out

Chart Created by Tyler Yell, CMT

Crude Oil Sentiment: Net-long crude positions bias provides contrarian signal to look lower

The sentiment highlight section is designed to help you see how DailyFX utilizes the insights derived from IG Client Sentiment, and how client positioning can lead to trade ideas. If you have any questions on this indicator, you are welcome to reach out to the author of this article with questions at tyell@dailyfx.com.

Crude Oil Price Forecast: Round 2 Of Harvey May Knock Oil Bulls Out

Oil - US Crude: Retail trader data shows 75.2% of traders are net-long with the ratio of traders long to short at 3.03 to 1. In fact, traders have remained net-long since Aug 14 when Oil - US Crude traded near 4776.5; price has moved 3.1% lower since then. The number of traders net-long is 13.9% higher than yesterday and 32.0% higher from last week, while the number of traders net-short is 1.7% lower than yesterday and 10.6% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Oil - 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 Oil - US Crude-bearish contrarian trading bias. (emphasis mine).


Written by Tyler Yell, CMT, Currency Analyst & Trading Instructor for DailyFX.com

To receive Tyler's analysis directly via email, please SIGN UP HERE

Contact and discuss markets with Tyler on Twitter: @ForexYell

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


News & Analysis at your fingertips.