章节 16 Bulls/Bears Are Cautious and Oil Oscillated Narrowly(12.12)
Fundamentals
During Tuesday's (December 12th) Asian session, WTI crude oil oscillated slightly, and it is currently trading at 71.6 dollars/bbl. Yesterday, the oil price fluctuations were narrow, once dropping 70.5 in the Asian session, and pulling up again to 71.5 in the U.S. session, closing the daily chart higher. In general, the trend was fluctuating yesterday, and the market seems to have entered a short-term equilibrium stage. Although the oil price has appreciated for 3 consecutive days, the oil bulls are not as good as what we expect. Besides, the market remains cautious to the later stage, and this is the trickiest situation, as you will finally gain something after staying calm. Yesterday, oil prices fell to the lower area as we expected, and if we go long at 70.5, we will earn a profit of 1 dollar. In the short term, oil prices may stop the oscillation and rebound but miss the momentum of a large rebound. As for the direction, we will see at the end of this year. However, I still expect a good trend in oil prices in the first quarter of next year with a target of over 80. For the oil trend, we hope that it will rebound after the resistance. When the oil bears press down the price to a range of 65-67, technical signs at the bottom will be more reliable. Then, investors with long positions will be glad. In the short term, we should not expect a clear trend, and investors could buy low and sell high today. When everything is ready, we can catch the opportunity in a fluent trend.
News: Affected by the storm, Russia's Black Sea Novorossiisk port crude oil loading in December declined from the initial plan of 2.14 million tons to 1.72 million tons. Russian Deputy Prime Minister Novak demonstrated, that if the market situation requires, major oil producers in OPEC+ will be ready to decide.
Today's focus: Investors should focus on tonight's U.S. CPI and API crude oil inventories. More importantly, try to monitor Thursday's retail sales data as well as the Fed's rate resolution early Thursday morning (the dot plot will be shown).
Technical Analysis
Oil prices maintained a complex movement during the last trading session. It closed the daily chart with a doji star after a wide range of oscillations and achieved 3-day growth. Moreover, signs suggest that a reversal is coming soon, and the MACD tends to form a golden cross in the oversold area regarding the daily chart, implying a continuous appreciation. At the same time, MACD forms a golden cross in the 4H chart, and Bollinger Bands expand further. Thus, oil prices may reach a new high today. If it crosses above 72.5, WTI crude oil may climb up to 73.8. However, if WTI crude oil is suppressed by 72.5, it may return to the support at 70.5. Today, investors should expect the oil price to stay in the oscillating range from 70.5 to 73.8, in which we can buy low and sell high.
Trading Recommendations
Trading direction: Long
Entry price: 70.500
Target price: 73.800
Stop loss: 70.000
Support: 70.500/67.000
Resistance: 72.500/74.500
