Oil price retreated on Tuesday following report that showed that OPEC’s September production hit record high. On the previous day, oil price strengthened on Putin’s comment that they would support OPEC’s effort to limit oil production.
On Tuesday, the International Energy Agency (IEA) reported that OPEC raised their production as much as 160,000 barrels per day to the record high at 33.64 million barrels per day in September. At the meeting in Algeria last month, OPEC had reached deal to lower the oil output to 33 million barrel per day maximum, but then they said that they will discuss about the details in the next OPEC meeting on November 30.
Some correction occurs on oil price, currently is moving between 20 MA and 50 MA on hourly chart. 20 MA is falling but 50 MA is still rising. We can see that the price currently is testing intraday support area at 50.64-50.05. Hourly stochastic is almost overbought and CCI is still rising.
Actually, a bullish signal was confirmed yesterday but the bullish momentum seems not too strong. Today, oil price possibly will rebound to 50.99-51.57, but watch for possible correction back into the intraday support area. In that case, look for bullish signal confirmation before taking long position with 50.99 as target and 51.57 in extension.
Be careful if the price managed to break support 50.06 because it will turn the intraday bias into bearish and possibly will be followed by bearish move to 49.71-49.13.
– Buy on bullish signal confirmation within 50.64-50.05; target at 50.99 or 51.57