Listen to the latest market mood for the USOIL.
Asian equity markets traded lower overnight over concerns around Chinese consumption after the drop in retail sales data. The positive risk tone from yesterday’s positive vaccine news is in the balance this morning as a slew of data is due today.
WTI crude futures have pulled back below $41 today after the OPEC+ meeting where producers agreed to effectively reduce output cuts to between 8.1 – 8.2 mln bpd for August.
The concern going forward is that the oil market will be saturated with oversupply in the future. Therefore, expect US oil sellers from rallies as long as these supply concerns remain is in the market.
Swing trade outlook – We expect this trade to play out over the next 1-2 weeks.
Trade Risks: If the risk tone switches to ‘on’ and positive vaccine news dominates markets this will invalidate the outlook.