Crude oil prices continued to decline final week reaching a low at 6857 as demand hit a 9 year low for the week ended Oct. 10. As demand has been in a gentle downtrend, the price of a barrel of oil has been minimize in greater than half since peaking at 147.27 in July 2008. Crude oil closed the week out at 7185 on Friday’s session of mild profit taking.
The general technical pattern stays down. Nonetheless, we are doubtless to begin to see a pause in downward momentum with sideways to upward value action early this week as we have now hit our key month-to-month help vary at 7100-6800. Additionally, in an effort to curb downward momentum, OPEC has moved their assembly up once more to Oct. 24 and is anticipated to cut output by as a lot as 1 million bpd.
We’ll be looking for upward strikes this week to head into the 7500-7700 Resistance range, with the 7700 space being last week’s key breakdown. Trade crossing above 7700 will likely be concentrating on the 8000 mark with OPEC objective to reclaim 8000 as their new benchmark value. If a settlement above 8000 is achieved for the week, we’ll be taking a look at an anticipated trading vary between 8000 and 9000 in the following weeks.
Trade that struggles this week at the 7500-7700 range is predicted to depart downward strain on oil, at least pre DOE experiences and OPEC assembly, with dips retesting the 7100-6800 range. A turn under the decrease end of the range at day by day support 6850-6800 is anticipated to set off a continuation of the most important downtrend with the following objectives seen at 6300-6000 and potentially 5500 on any major DOE surprises.