Chapter 32 With A Doji Star at the Bottom, Can Oil Prices Stand Firmly?（11.28）
Fundamentals
During the Asian session on Tuesday (November 28), WTI crude oil fluctuated in a narrow range and is currently trading around 75.3 dollars per barrel. Yesterday, oil prices fluctuated widely, closing a small black candle with long upper and lower shadows, and the gap that opened low still did not makeup. Yesterday, oil prices also basically retraced as expected. After the hourly K-line showed a reversal signal of one bear candle covering two bull candles, oil prices declined continuously at the hourly level. Eventually, the price began to rebound after the decline stopped at 74.1, rebounding by $2 and rising as high as around 76.3. The main factor leading the decline in oil prices was news on Monday that Saudi Arabia was seeking output cuts from other OPEC+ members, while some members expressed opposition. However, in the face of the imminent meeting, the bears did not persist, and the take-profit market pushed the rebound in oil prices. At the moment, the market is extremely weak. In other words, the bulls are so insecure that can be said less expectations but are afraid of the meeting in 2 days. Currently, investors are worried about their positions, just because the market is now dominated by bears. If traders want to regain confidence, the market can only increase the intensity of production cuts, but this probability is very small. For the bulls, they may just want to have a good time now and only hope that it will be a little faster until Thursday. As for the outcome of the meeting, my view is that OPEC+ still has influence, and member countries still need the organization. After weighing the pros and cons, there may be slight tailwinds in the end, but the continuation of production cuts may be a high-probability event. In this regard, after the deep fall in oil prices, it is still a good opportunity for traders to try to go long.
Data: US annualized new home sales in October were 679,000, with an expectation of 723,000.
Today's attention: US FHFA home price index for September, consumer confidence index for November consultation, API crude oil inventories, and FOMC members' speeches. Traders should mainly focus on the relevant news and results of this week's OPEC+ meeting.
Technical Analysis
Oil prices fluctuated and fell yesterday under the news, falling as low as 74.1, and then rebounding quickly to 76.2. Finally, the price closed a Doji Star with long upper and lower shadows, and the market is still relatively resistant. At present, the market has accumulated a lot of gaming positions in the 74-75 area. If it cannot break through 73.8 at the beginning of the week, crude oil may have to rebound strongly, and the above may be seen above 77.1. Currently, the golden cross of MACD begins to widen upwards in the 1-hour K-line, and a bullish penetration line has occurred. Perhaps, the Asian market will rebound slightly, and the Doji Star in the daily chart also seems to have a weak and firm trend in the short term. During the day, traders should focus on the support situation around 73.8, and the upper resistance around 77.1 should also be paid attention. Aggressive traders can continue to trade in this range, and mainly focus on the opportunity to participate in long positions at low.
Trading Recommendations
Trading Direction: Long
Entry Price: 73.800
Target Price: 77.810
Stop Loss: 73.300
Support: 73.800/72.500
Resistance: 77.100/78.500
