In the past week, oil has dealt with the monthly unemployment report, various OPEC and Fed speak and this morning’s weekly EIA report. Yesterday’s FOMC minutes steered more towards inflationary caution than the prior month, or many months past for that matter, while this morning’s EIA inventories showed a 2.7 million barrel draw for the previous week.
In the two hours following the report, oil traded in most of the range of the $50 handle while mostly above the hourly 100 moving average, and psychologically significant $50 level and below the 50 period. It is interesting to note the potential coiling price action over the longer term between these moving averages and 2 point trend lines drawn from the August 30 and October 9 lows, and September 29 and October 11 highs.
Many see oil as range bound around the averages’ flat rate of change and $50 level, between the defining points of the previously mentioned trend lines. Any close above or below these trendlines and/or there defining points should see significant follow through.
Nov ’17 Crude Light 240 min Chart
Nov ’17 Crude Light 60 min Chart