October Crude Oil broke down on Monday, August 22, 2016, trading to 47.33 just above the Thursday low of 47.28 when October became the lead month as traders react to the latest news. The Niger Delta Avengers announced they would suspend attacks on oil companies in order to engage in talks with the government to end the conflict. If the ceasefire lasts it would add approximately 600,000 barrels of crude oil to an already over supplied market.
This is the amount lost from Nigeria due to the attacks on its pipelines. China’s exports of diesel and gasoline exploded in July increasing 181.8% and 145.2% respectively adding to the glut in products. I guess the weekend also caused traders to snap back to reality and for the time being think the September meeting in Algeria won’t amount to anything. Plus Iraq plans to increase its exports by 150,000 barrels this week. How can anyone believe OPEC will freeze production? Crude oil has trendline resistance up at 49.27 and then prior highs 50.54 and 51.67. Support is at 46.93 and then the 8 DMA at 46.59. The 50 DMA is at 45.62 and the 100 DMA is at 45.33.
High 49.08
Low 47.33
Last 47.39
Daily Pivot Points for 8/23/16
R2 49.68
R1 48.54
PIVOT 47.93
S1 46.79
S2 46.18