Delayed - 07/19 01:35:49 am

The oil wakes up

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01/30/2013 | 03:31 pm
Opinion : Bullish above 95 
Target price : 108.5 
U.S WTI crude barrel is sharply moving up at the beginning of this week regaining its highs since September 2012. Investors seems to be reassured by the less alarming future global outlook than expected due to a series of good macroeconomic publications including the U.S and particularly in China where growth is gradually regaining a second wind.

Even if prudence remains in place, waiting for important deadlines in the coming days in the United States: U.S crude oil inventories, Fed meeting, Q4 GDP and employment figures on Friday, Crude Oil prices are especially supported by an USD decline which technically drives an increase in raw materials. In addition, the monetary policy of the U.S central bank is expected to remain very accommodative this year continuously stimulating the U.S economy, the largest worldwide consumer of oil.

Meanwhile, financial operators have been encouraged by a statement from the Secretary General of OPEC, Abdalla El-Badri, who held that a decrease in crude oil prices is unlikely this year according to him supported by a comeback of a stronger growth in emerging countries. At the same time, China, the second largest consumer of oil, announced that its needs in oil were going to rise this year by more than 7%, the largest increase since 2006.

Therefore, WTI prices will continue to remain faced to macroeconomic publications, geopolitical risks and weekly U.S crude oil inventories publications.

Technically, the situation is now bullish in daily data above 95 dollars, a threshold coinciding with the 20-day moving average. The comeback of the appetite for risky assets observed at the beginning of 2013 should continue to support the trend and the oil should rapidly find the USD 100 then the USD 110. We can exploit the continuation of this upward trend thanks to the future Crude Oil Future (Code: CLXXXX) on the Nymex futures market.
Rodolphe Steffan
Zonebourse.com 2018
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