In the Asian trading session today, crude oil was observed trading below the $84 mark. This recent downturn in oil prices can be attributed primarily to the latest U.S. inflation data, which has impacted speculative forecasts regarding the Federal Reserve’s monetary policy actions.
The Personal Consumption Expenditures (PCE) Price Index in the U.S. for March showed an increase to 2.7% from 2.5% in February, exceeding expectations of a 2.6% rise. Since these figures surpass the Federal Reserve’s target inflation rate of 2%, they play a crucial role in shaping the central bank’s stance on interest rates. Higher inflation typically diminishes the likelihood of interest rate cuts, which are often implemented to stimulate economic growth.
Normally, lower interest rates can boost economic activity and demand for commodities like crude oil. However, the persistence of higher inflation suggests that such rate cuts may not occur in the near term, thus dampening potential increases in commodity demand.
Further influencing oil prices are geopolitical developments, particularly the efforts to mediate peace in the Middle East. According to reports, discussions are underway in Cairo involving a Hamas delegation, aimed at brokering a ceasefire. Additionally, Israel’s consideration of delaying military actions contingent upon the success of these peace talks, including the safe return of hostages, has also played a role in the market’s response.
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Technical analysis
Time Frame: 1 hour
CRUDEOIL Support & Resistance Table – 29/04/2024
| Support & Resistance | Level | Explanation |
| Resistance 2 | 84.37 | Daily R2 |
| Resistance 1 | 83.86 | Daily R1 |
| Support 1 | 82.52 | Daily S1 |
| Support 2 | 82.01 | Daily S2 |
CRUDEOIL Indicator Table – 29/04/2024
| Indicator | Signal |
| SMA 20 | Sell |
| SMA 50 | Buy |
| SMA 100 | Sell |
| MACD( 12;26;9) | Buy |
| RSI (14) | Neutral |
| Stochastic ( 9;6;3) | Sell |
CRUDEOIL Indicator / Period Table – 29/04/2024
| Indicator / Period | Day – Sell | Week – Buy | Month – Buy |
| MACD( 12;26;9) | Buy | Buy | Buy |
| RSI (14) | Neutral | Buy | Buy |
| SMA 20 | Sell | Buy | Buy |
CRUDEOIL 29/04/2024 – Reference Price : 83.19
| SELL | Simple Moving AverageBuy (1)Sell (2)Technical Indicators – OscillatorsBuy (1)Sell (1) |
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