Crude Oil Range Bound Ahead of OPEC+ Gathering and FOMC Minutes

The price of crude oil has experienced fluctuations on Wednesday due to the upcoming OPEC+ meeting commencing today in Vienna. The variation in prices can be attributed to the absence of trading activity in the United States on Tuesday, which resulted from a national holiday.

The West Texas Intermediate (WTI) futures contract is experiencing an upward trend as it nears a value of US$ 71 per barrel, whereas the Brent contract has fallen below US$ 76 per barrel.

Despite the commitment of Saudi Arabia and Russia to extending their production cuts earlier this week, prices have remained sluggish.

Today, the price of gold has experienced slight increases, surpassing the threshold of US$ 1,925 in trading.

APAC equities experienced a challenging day following the release of China’s Caixin services PMI for June, which fell short of expectations. The actual reading of 53.9 was lower than the anticipated 56.2 and the previous reading of 57.1. Additionally, the composite PMI declined from 55.6 to 52.5.

During the session, Hong Kong’s Hang Seng Index (HSI) experienced a significant decline of over 1.5%, reflecting the prevailing negative sentiment.

The currency markets are experiencing a lack of activity, possibly due to the absence of US traders who are on holiday.

The Federal Reserve’s FOMC minutes from the June meeting will be published later today. Investors will be searching for indications regarding the future trajectory of interest rates, as the Fed initially halted their rate hikes but subsequently adopted a more hawkish stance following the conclave.

New York Fed President John Williams will also be speaking today.

WTI CRUDE OIL TECHNICAL ANALYSIS

In the academic context, WTI crude oil has been experiencing range trading conditions for over two months, with prices fluctuating between 66.80 and 75.06. Additionally, since November of last year, it has maintained a trading range of 63.64 to 83.53.

With this in mind, previous highs and lows might provide resistance and support respectively.

On the downside, support may lie at 67.03, 66.82, 66.80, 64.36, 63.64 or at the November 2021 low of 62.43.

On the topside, resistance could be at 72.72, 73.28, 75.06, 76.92 and 79.18 ahead of a cluster of breakpoints and prior peaks in the 82.50 – 83.50 area.