The price of the black gold has kept at the 52.00 USD level during the late May. It was the reason for emerging of a downward trend. Futures for #CL (the WTI oil) have lost in price more than 10.5%.

Source: finviz.com

We could notice aggressive sales on the oil market yesterday. The fall of the WTI crude oil futures was more than 5%. It happened so because of a sharp increase in the US petroleum stocks.

Details of the U.S. Energy Information Administration report:

  • oil reserves: +3.295 million barrels;
  • gasoline stocks: +3.324 million barrels;
  • distillates stocks: +4.355 million barrels;
  • the demand for oil: – 0.283 million barrels/day;
  • the imports: + 0.356 million barrels/day;
  • the refinery load: – from 95.0% to 94.1%.

    • The price, which was actual when the OPEC agreement regarding reducing the production was adopted, is the same at the moment. After yesterday’s report, a question of the effectiveness of that agreement has risen. Also, Saudi Arabia and other Persian Gulf countries have toughened their diplomatic relations with Qatar. This fact pressures the black gold market as well.

    Technical analysis. Trading recommendations

    Support levels: 45.75 USD, 44.25 USD

    Resistance levels: 47.00 USD, 52.00 USD

    Bears are dominating here now. The technical pattern shows us a possibility of a further drop in the oil prices:

    1) The 200 MA is above the 50 MA;

    2) The MACD histogram continues declining after it has fixed in the negative zone.

    2) The appearance of the “Bearish Engulfing” PA pattern on the D1 timeframe.

    Conservative traders should wait for a correction to the 47.00-48.00 USD offer area. You may open shorts if the oil quotes reach this mark.

    You may also sell oil if the price fixes below 45.75 USD. I advise you to use a trailing stop in this case.

    44.25 USD is the closest goal for taking profit. The oil price can reach the 42.00-43.00 USD level in the medium term.

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