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Fundamentals

During the Asian session on Monday (November 6), WTI crude oil fluctuated downward in a narrow range and is currently trading around 80.7 dollars per barrel. Oil prices rebounded continuously on Friday, but the final rebound failed and declined again. However, the price generally held the support level around 80, which was only one step away from the $80 mark. The bulls are relatively tenacious in the key support positions, and on the whole, there is still little profit in the trading strategy of constantly buying low. Last week, we emphasized that don't expect how much profit the market is now, and don't chase the ups and downs mindlessly. At present, although the pressure to raise rates has been greatly reduced, the sluggish data of the world's major economies has raised concerns about weakening demand, which also masks the positive impact of the geopolitical pattern. At the moment, the interweaving of bullish and bearish factors is more obvious. For short-term oil prices, it is difficult to effectively fall below 80, which is also the target price of the United States' imminent replenishment strategy and crude oil reserves. For the time being, the market has seen a negative risk premium. Oil and copper, which are economic barometers, have begun to stabilize and rebound, and it is more difficult for oil prices to fall sharply. But at the same time, if we do not consider the uncertainties of geopolitical conflicts, with the current supply and demand pattern, it is difficult for oil prices to break through the year-to-date highs set at the end of September. In the face of such ups and downs in oil prices, it will be more difficult for investors to trade, and the rhythm is particularly crucial. Again, we stress that investors should hold your hands and wait patiently for the market you want. During the day, traders need to pay special attention to the long opportunities in the European market, as long as the fall stops, you can go long, and wait for the US market to rise.

Data: The US Labor Department's Bureau of Labor Statistics (BLS) employment report, released on Friday, said that nonfarm payrolls increased by 150,000 last month, less than the expected 180,000. Average hourly earnings grew at an annual rate of 4.1%. The unemployment rate rose 1% to 3.9%. In addition, the ISM non-manufacturing PMI in the United States recorded 51.8 in October, a new low in five months.  

Today's attention: There is no important data yet. The beginning of the week is mainly to digest the Federal Reserve's monetary policy decision and the economic data from last week.  

Technical Analysis

Oil prices have skyrocketed and plummeted last week. From Monday to Tuesday, the main tone was falling, and Wednesday and Thursday were fluctuating at a low level. Oil prices failed to rebound again and continued to fall sharply, but they still held support around 80. Judging by the last multiple tests, the strength of support around 80 should not be underestimated. A valid break below 80 could see oil prices accelerate to the downside, with support around 77.5 tested below. If it does not break, the price will continue to be dominated by oscillation in the 80-83.5 area. For investors, there are not many opportunities to participate in the Asian market, and you can wait patiently for the signal to stop falling in the European market, and then try to go long at a low.  

It is recommended that investors mainly go long at low. If the oil price retraces largely to 80.2, you can go long with small positions. The stop loss is set at 79.7, and the first target to take profit is 82.5, where you can reduce your positions and move the stop loss to break even. The second target to take profit is 83.5. If the price effectively falls below 80, investors should not chase long for the time being, unless oil prices show signs of stopping after a deep and rapid decline.

Trading Recommendations

Trading Direction: Long

Entry Price: 80.200

Target Price: 82.500

Stop Loss: 79.700

Support: 80.000/77.800

Resistance: 81.500/83.500