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CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

Oil prices finish higher on fundamental updates

Technical overview remains volatile with retail trader buy bias dropping on price gains.

Source: Bloomberg

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Oil WTI technical analysis, overview, strategies, and levels

As it wasn't an oscillatory session like last Tuesday (the bulk of movement in one direction, up), we got a move past its previous first Resistance level. Earlier this morning, moves got closer to its previous second level with conformist buy-breakout strategies winning out while contrarian reversals got stopped out.

In no way has it changed its current daily (and weekly) time frame with a technical overview that’s volatile even if plenty of its technical boxes are flashing green and combined with a trending ADX (Average Directional Movement Index).

Events to watch

  1. The CPC (Caspian Pipeline Consortium) pipeline disruption impacted 1.2m barrels with Russia's Novak saying oil supplies through it could be stopped by up to two months.
  2. Inventory data out of EIA (Energy Information Administration) shows a 2.5m barrel decrease with gasoline down 2.9m and a drawdown for distillate of 2.1m.
  3. Russian demands for payment for gas sold to "unfriendly" countries with key natural gas contracts in the US and Europe finishing yesterday’s session higher.
  4. Further sanctions are expected to be announced following summits over the next two days.
Source: IG

Learn more about oil trading.

IG client* and CoT** sentiment for Oil WTI

As for sentiment, majority buy 57% amongst retail traders as of yesterday morning has dropped to a slight buy 52%. Thanks to the price gains with longs enticed into closing out and some fresh shorts initiating.

(CoT speculator bias is as of last Friday’s report in what has been consistent extreme buy bias amongst them and visible on the chart below in the green-dotted line as % long bias amongst them).

Source: IG

Oil WTI chart with retail and institutional sentiment

Source: IG

*The percentage of IG client accounts with positions in this market that are currently long or short. Calculated to the nearest 1%, as of today morning 8am for the outer circle. Inner circle is from the previous trading day.

**CoT sentiment taken from the CFTC’s Commitment of Traders report, outer circle is latest report released on Friday with the positions as of last Tuesday, inner circle from the report prior.


This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

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