This week, crude oil has fallen after rising 16.89% last week, down about 6.8%, which is considered to be a reversal of the increase of last week. But the overall trend is still bullish, and this decline is as expected, . Our previous judgment was that after the turn of 7, we saw around 13, so we were mainly high altitude before. The final proved that it was correct, and on the 13th turn, there was also a bottoming out and rebounding and rising sharply, but Friday's decline made this uncertain . From a fundamental perspective, the core key that caused the continuous fluctuation and rebound of crude oil this week is:
1, This week, IMF President Georgieva and World Bank President Malpass warned the market that the risk of global recession is increasing. The IMF lowered its forecast for global economic growth in 2023.
2, This week, OPEC and U.S. U.S. 1The Ministry of Energy has all lowered its oil demand expectations. OPEC lowered its demand growth forecast this year by 460,000 barrels per day to 2.64 million barrels per day as Asian countries re-adopted epidemic prevention and control measures and high inflation.
3 and US consumption will only increase by 0.9% in 2023, lower than the previous forecast of 1.7%. The sector expects global consumption to grow by only 1.5%, down from 2% previously forecast.
4, this week data released by the U.S. Bureau of Labor Statistics showed that the month-on-month increase in the United States in September was higher than expected: the inflation rate in September reached 0.4%, higher than the 0.2% expected by Wall Street , and higher than the data in August. CPI rose 8.2% year-on-year, a slight decrease from 8.3% in August.
5, Concerns about the recession are shrouding the oil market, but the risk of oil shortage remains. Bad news on the supply side is also coming, and global oil inventories are declining and will be difficult to reverse. Some analysts pointed out this week that U.S. oil inventories have dropped by 480 million barrels in the past two years, reaching the lowest level since 2004. The production cuts of
6 and OPEC+ will make the already tense oil market even more tense, especially when EU imposes an embargo on Russian oil and an oil price ceiling. The above factors of
are the key to causing crude oil to fluctuate and fall. The most essential reason for is that under high inflation, the expected increase in the global economic recession of , and the possible decline in crude oil demand in the future is the core essential reason for the current situation. , and last week's sharp rise was due to the unexpected production cut, which is the key to further tightening of crude oil supply. So what is rising is the present, and what is falling is the future factor. What we do as a whole is the future, so the general direction is bearish, and the strong rebound in the short term has changed due to the current factors! Overall, we continue to be the main focus of high altitude this week, but we continue to increase the flat and short positions on the 13th, and the structure of next week still depends on the breakthrough next week and further judgment!
On the news front, This week's regular data EIA crude oil inventories increased significantly, The changes in the U.S. EIA crude oil inventories actually increased by 9.88 million barrels in the week ending October 7, an expected increase of 175 barrels, and the previous value decreased by 1.356 million barrels. But from the current perspective, I think the probability of small profits expected to be higher next week's API and EIA data is expected to be more important, because it is impossible to continue to increase and rise. Moreover, after such a large increase was announced this week, there was no big drop. Therefore, if it is positive, it may be more bullish. In addition to regular data, some events that will be focused on next week: such as the Russian issue, the Iranian issue, etc.
1. Iran issue: The EU Foreign Ministers' Meeting was held on October 17 to discuss the issue of further sanctions on Iran. If sanctions are decided, it will lead to a decline in Iran's oil production and is expected to provide certain support for oil prices. If so, the overall benefits of crude oil.
Iran's Ministry of Foreign Affairs issued a message that on October 15 local time, Iran's Foreign Minister Abdullahyan had a phone call with Borelli, the EU's Senior Representative for Foreign Affairs and Security Policy.Abdullahyan thanked Borrelli for his efforts to help all parties resume their commitments under the Iran nuclear agreement (JCPOA). He said: "Although the US has issued some contradictory media statements, the steps to reach the agreement are still continuing. The correct path, within this framework, we welcome cooperation with International Atomic Energy Agency in the field of technology." It is difficult to judge the future development direction, so we can only observe further.
2. Russian issue : The core of the moment is that crude oil supply may also have problems caused by the escalation of war. If there is a problem, there is no need to say that Europe and the United States are sanctioning Russia or the embargo in December. It is also beneficial to crude oil bulls as a whole.
Gazpromium AG: It will continue to transport natural gas to Europe through Ukraine, with a delivery volume of 43.1 million cubic meters on Saturday. From this point of view, their relationship has eased, and this overall is a small negative crude oil.
3, Energy Positions : Speculators held Brent and WTI crude oil net long positions increased by 35,521 lots to 408,988 lots of contracts, setting a new high in the last 15 weeks. The net long positions of NYMEX WTI crude oil held increased by 19,305 lots to 208,666 lots, setting a new high in the last 11 weeks. The net long position of NYMEX gasoline fell to 52,825 contracts. The natural gas futures net short positions in NYMEX and ICE markets increased by 2311 lots to 78201 lots.
Technically, This week, as expected, it continued to fluctuate and adjusted to the 13th. Before, we expected that the 13th turning point was a low point, but the actual situation was a low point on the 13th turning point, and there was a strong rebound on the day. But the final result was another big drop on Friday, which made this structural market uncertain. Therefore, the core of next week should be to look at the breakout between 85 and 89.65. If it goes up, it is to look further bullish, otherwise it is to be further bearish. The next time cycle turns on the 20th. The end of the month will be seen later, so a breakthrough next week is key. . Judging from the current situation, I think the probability of further bearishness is relatively high, but I think the future rebound is not over, so we can consider setting up a bull again after the decline. If it rises, it will rebound in the C wave. Then the probability of seeing a long $97 will rise sharply, and the core of the future is to look at the pressure here at $93.65.
More on the intraday strategy, and now I think the fourth wave rebound will be running later, and the second wave rebound will be very complicated, so I need to make a clearer division here, and there will be a big 5 wave downward trend in the future.
