Oil Price Gains On US Inventory Drawdown

Fundamental Analysis

* Supply Squeeze: Oil prices climbed in Asian trading on Wednesday, remaining close to two-month highs. This rise followed industry data indicating a significant drawdown in U.S. inventories over the past week, which bolstered demand optimism. According to the American Petroleum Institute, U.S. inventories decreased by nearly 9.2 million barrels in the week ending June 28, far exceeding the anticipated draw of 0.15 million barrels. This data, often a precursor to similar official inventory figures expected later on Wednesday, heightened optimism about increased U.S. demand, coinciding with the travel-heavy summer season. Additionally, the American Automobile Association predicted record road travel this week due to the Independence Day holiday on Thursday.

Technical Analysis

* Technical Breakout: Crude oil price was traded higher following prior rebound from the support level 82.75. MACD which illustrate diminishing bearish momentum signal suggest the commodity to extend its gains.

* Resistance and Support: If the bullish momentum persists, there’s a strong likelihood that the price will potentially head towards 84.35. Conversely, a potential correction is also to be expected and the price could head towards 81.40 after it breaks below the level 82.75.

Understand how technical analysis can help you in this trading opportunity.

Potential Risks

Looking ahead, the market is expected to focus on further comments from the Federal Reserve and key labor market data for additional economic cues. Additionally, investors will be closely monitoring developments in the Middle East, where tensions between Israel and Hezbollah show little signs of easing, potentially disrupting supply.

Know how to manage trading risks with risk management strategies.

Monitoring

Stay updated on US data, central bank update, Middle East developments and any shifts in the US Dollar’s strength by following PU Prime’s market insights and daily financial news.

Grab the trading opportunity and dive into the action risk-free with a free demo account. It is the perfect way to hone your skills and explore the exciting world of trading!

Open Your Free Demo Account And Start Trading Risk-Free

Join Now

Disclaimer: Trading derivatives involves high risks, and market conditions can change rapidly. The content is for informational purposes only and should not be considered as financial advice. Traders should conduct their own research and consider risk management strategies.