FXEMPIRE
All

Crude Oil Steady as Investors Stay on the Sidelines Ahead of Fed Decision

Crude prices are calm, but that could change on Wednesday, when the Federal Reserve releases its monthly rate decision. A vote of confidence in the economy from the Fed could boost crude prices.
Kenny Fisher

Crude oil is flat in Tuesday trade. In the North American session, West Texas Intermediate crude oil futures are trading at $59.22, up $0.34 or 0.58%. Brent crude oil futures are trading at $64.38, up $0.34 or 0.53%.

WTI is coming off its best weekly performance since mid-September, after posting strong gains of 6.7 percent. Investors gave a thumbs-up to a sparkling nonfarm payrolls report on Friday and OPEC’s announcement that it would implement further production cuts, effective January 1. This move, engineered by Saudi Arabia, was taken in order to stabilize oil prices in an environment of a huge oversupply of crude on global markets. At the same time, some OPEC members are notorious for failing to adhere to their production quotas, and if the new agreement is not adhered to, oil prices could head lower.

Will Fed Statement Affect Crude Prices?

The Federal Reserve will be in the spotlight on Wednesday, when rate-setters conclude a two-day policy meeting. The Fed is almost certain to maintain current rate levels. The Fed has signaled a pause in rate cuts, after trimming rates on three occasions this year. This means that the upcoming rate statement and comments from senior Fed officials will be closely scrutinized and could shake up oil prices. The U.S. economy has posted solid numbers lately, and if policymakers sound positive about economic conditions, crude prices could respond with gains.

 

Technical Analysis

WTI/USD continues to put strong pressure on resistance at 59.25. If the pair can break above this line, the symbolic level of 60.00 will be vulnerable.

On the downside, we have support levels at 58.50 and 57.50. This is followed by the 200-EMA at 57.08 and the 50-EMA at 56.65. The next support level is at 56.50. With crude facing significant support barriers, the trend remains upward.

WTIUSD 1-Day Chart
Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All
IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US