US Stocks Slip Due to the Continuing Slump of Crude Oil

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US crude oil price falls below $20

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Crude Oil Price Forecast – Crude Oil Markets Slump

WTI Crude Oil

The West Texas Crude Oil market initially rallied during the trading session on Monday, reaching towards the $60 level before pulling back. It looks as if the 200 day EMA has offered resistance as well, but we also have the hammer from the Friday session, which has the look of a market that is trying to stabilize itself. That being the case, I would not read too much into the Monday candlestick, and recognize that if we can break above the top of that candlestick, it means that will go looking towards the top of the range. Alternately, if we break down below the hammer from the Friday session, then we will certainly be looking to go towards the $55 level.

Crude Oil Video 21.01.20

Brent

Brent markets also tried to rally initially but then gave back quite a bit of the gains. There is a hammer on Friday here as well, and that should continue to help support the market. We are hovering around the $65 level, which of course is a large, round, psychologically significant figure that people will be paying attention to. If we break above the highs from the Monday session, I believe at that point the market will probably go looking towards the $67.50 level. However, if we break down below the bottom of the hammer from the Friday session, then it’s likely that we will go looking towards the $60 level underneath. At this point, the market is very choppy but stable and therefore it looks like we may recover at first glance.

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Crude Oil Weekly Forecast: Deal or No Deal – Oil Prices Continue to Slump

Crude Oil Week Ahead Forecast: Neutral

  • OPEC proposal of 1.5 million barrels per day production cut fails to materialize
  • Russia are currently refusing to back any further output cuts.

Crude Oil Roiled by Coronavirus Epidemic

A game of brinkmanship between OPEC and Russia over new output cuts failed to materialize today . OPEC had proposed cutting oil production by 1.5 million barrels per day until the end of the year, yet Russia refused to back the cuts, instead pushing for an extension of the current level of production. OPEC’s proposal needs to have the backing on non-OPEC producers, including Russia. The breakdown in talks lead to oil declining over 10 percent Friday, the largest drop since 2020.

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The continued spread of coronavirus is hammering demand for oil and this is unlikely to change in the months ahead. Chinese data showed economic activity slumped in January as businesses and factories shuttered and the economic malaise is spreading with global supply chains creaking and breaking, dragging economies across the world close to, or into, recession. A raft of central banks have either cut interest rates in the past week or are considering cuts before or at their next policy meetings in an effort to boost growth, but financial markets are ignoring this continued liquidity flush and continue to spiral lower.

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