WTI CRUDE OIL - USOIL likely to find a floor around $78.50 for now - 05/02/2024 (GMT)

Rising stocks of crude in the USA over recent weeks have put a hold to the commodity's long rally for now. However, recent rumours that the government's Strategic Petroleum Reserve might start to be refilled with prices of American light oil (Exness' symbol 'USOIL') below $79 seem to be a key reason for reluctance to push much below $80 a barrel as yet.

The rising channel has been broken clearly, which usually might be expected to open up the latest intraday low, around $76.50 from 11 March. That seems to be a challenge now both because of the fundamental (and political) situation and the price being in the value area between the 200 and 100 SMAs. The slow stochastic signals oversold, which adds to the overall impression that a pause or small bounce might be more likely than immediate continuation lower.

$80 is an important psychological zone and the area of early March's highs, so it's a likely resistance. The upcoming NFP probably won't have as big an impact on oil as gold, but it's important to watch for any major surprise while not forgetting the regular rig count on Friday night and next week's usual stock data. With no top-tier Chinese data due until 17 May's industrial production, the price might find a range around $78.50-$81.

This is my personal opinion which does not represent the opinion of Exness. This is not a recommendation to trade.