WHERE IS THE CHEAP OIL?

I don’t know, but it has gone with the wind. This year analysts and anchors always found something why the oil jumped higher and higher again. First, was the severe winter conditions in US then the Russian invasion of Ukraina and now the summer and the holiday season. Maybe they are right, maybe not in terms of fundamental, but the funny thing is the weather and Putin should be a great technical analyst because they always react at key support and resistance levels in the oil chart.

The oil has a PhD in economics and recently seems the recession is over all macro numbers are getting better quarter by quarter in the world economy. That means upside power and more upside potential for the oil in middle term. On the weekend, China reported trade surplus and Japan’s GDP beat the expectations, which indicates both economies are in good condition.

First time since last August the WTI Oil futures climbed above $104,50 a barrel yesterday. The market shows very strong bullish sentiment. Monday the price jumped up from $102,70 to $104,50. Gained 1,7% within a day on the NYMEX the WTI Crude Oil. In terms of dollar gains were the largest in about two months.

In terms of technical aspects the WTI Oil is in a triangle recently, and pretty close to the break out. If it would be taken within few days the next resistance level is at $114, so there is another $10 gap on the long side.

The BFM Assets Team.