OPEC+ Meeting may bring big move in Crude Oil.
Crude oil prices extended their losses for the fourth consecutive day today. Crude oil on the MCX division dropped from morning high 6526 to 6475.00. Looming interest rate hikes by major central banks and signs of strong Russian exports offset rising Middle East tension over a drone attack in Iran and hopes of higher Chinese demand weighed on sentiment.
New York-traded West Texas Intermediate, or WTI crude, and London-traded Brent oil opened slightly positive at the start of Asian trading on Monday. But OPEC+ meeting outcome speculation pulled down oil prices from morning high.
WTI crude was down 0.13%, to $79.27 per barrel by 02:24 ET (07:24 GMT). The US crude benchmark fell 2.80% last week after a cumulative 10.80% rally in two prior weeks.
Further, focus will shift on OPEC+ meeting. On Feb. 1 meeting of OPEC+ comes first with no production change expectation from 13-member Saudi-led Organization of the Petroleum Exporting Countries. Ten oil allies steered by Russia, the meeting will effectively rubber-stamp the output OPEC+ agreed to in December. Crude oil buyers typically hope for OPEC+ to announce cuts in production in the meeting.
Further, Federal Reserve and European Central Bank, along with US employment numbers and earnings, will drive what could be a volatile week for Crude oil.
Technical Outlook
Our last report released on 25 January 2023 was proven accurate. Crude oil prices retreated from high 6740 and dropped to 6445.Predicted target was 6490.
In Near Future Crude oil may show consolidation before next any big move.
Since 23 January 2023, Crude oil Future is struggling to cross massive resistance 6745. And on the downside, crude oil is retreating towards 6450-6440 levels. On the daily chart, formation of long bearish candlestick is indicating bearish momentum in the near future. Adding to this, Crude oil future is still trading below 100 SMA, this also indicates bearish momentum in near future.
Now, crude oil futures need to break 6410 in order to test next support 6350. Alternatively, short time pullback could expect towards 6485-6550 again.
Strategy – Buy around 6480-6490 Target 6580 Stop loss below 6420.00
Or
Fresh sell expect below 6410 Target 6350