- WTI oil falls more than 1.50%, affected by the problems of the Chinese real estate sector and the strength of the US dollar.
- Oil prices are reeling despite geopolitical tensions, pressured by global economic concerns and central bank policies.
- The market awaits the API and EIA reports to know the values ​​of US crude oil and distillates amid economic uncertainty.
He West Texas Intermediate (WTI) falls sharply by more than 1.50% on Monday, after failing to overcome a key technical resistance level, along with demand problems caused by the real estate crisis in China. Despite growing tensions in the Middle East, traders are preparing for the decision of the US Federal Reserve (Fed) to maintain the strength of the Dollar. At the time of writing, WTI is trading at $76.90.
Crude Oil Struggles to Break Key Resistance, Plunges on Risk Appetite
The real estate crisis in China could be about to get worse, as a Hong Kong court ordered the liquidation of real estate giant China Evergrande Group. Sources quoted by Reuters said: “The situation in China is the biggest headwind for the entire market; that is why the market continues to retreat from the war risk premium.”
Oil prices failed to recover after Monday's attack on a Russian oil facility, at the Slavneft-YANOS refinery in the city of Yaroslavl.
Meanwhile, tightening by global central banks is keeping oil prices slightly depressed as the Federal Reserve (Fed) and Bank of England (BoE) take center stage for the week. Both central banks are expected to keep rates unchanged, although the former supports the Dollar (USD).
The Dollar Index (DXY), which tracks six currencies against the dollar, rose 0.14% to 103.61, providing a headwind for dollar-denominated assets.
Still, oil traders are awaiting the American Petroleum Institute's (API) US reserves report on Tuesday, ahead of the US Energy Information Administration's (EIA) release. on Wednesday.
U.S. crude oil and distillates are expected to decline last week, while gasoline stocks rose, according to a Reuters poll.
WTI Price Analysis: Technical Perspective
As WTI failed to break the 100-day moving average (DMA) at $79.37, sellers returned to the fray and Oil prices were dragged below the 200-DMA at $77.44, exacerbating the decline. below $77 per barrel. A daily close below the latter figure will expose the $76.00 figure, followed by the 50-DMA at $73.54. The lowest level is at $73.00. On the contrary, if buyers push the price above $77.00, a test of the 200-DMA is expected.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
