WTI trades sideways around $79.00 with eyes on PBoC policy decision

Source Fxstreet
May 17, 2024 14:11
  • WTI trades inside Thursday’s trading range ahead of PBoC’s interest rate decision.
  • The oil demand outlook has improved as US inflation softens as expected in April.
  • Fed policymakers see a one-time decline in inflation as insufficient to roll back restrictive policy stance.

West Texas Intermediate (WTI), futures on NYMEX, are stuck in a tight range slightly below $79.00 in Friday’s New York session. The oil price struggles for a direction as investors shift focus to the People’s Bank of China’s (PBoC) monetary policy decision, which will be announced on Monday.

The PBoC is expected to maintain a dovish stance on interest rates as the Chinese economy is still recovering from low consumer price inflation due to weak consumer spending. Investors should note that Canada is the largest importer of Oil in the world and the maintenance of expansionary policy stance by the PBoC improves its near-term outlook.

Meanwhile, the decline in the United States inflation has also improved prospects of the oil demand. The expected fall in the US inflation as indicated by the Consumer Price Index (CPI) report for April has boosted expectations that the Federal Reserve (Fed) will start reducing interest rates from the September meeting.

However, Fed officials have not convinced that inflation is on track to return to the desired rate of 2%. On Thursday, New York Fed Bank President John Williams said the monetary policy is restrictive and is in a good place. He doesn’t see any economic indicator suggesting the need to change the stance of monetary policy now. When asked about the inflation outlook, Williams said, “In the very near term, I don't expect to get that greater confidence that we need to see on inflation progress towards a 2% goal," Reuters reported.

WTI US OIL

Overview
Today last price 79.0
Today Daily Change 0.19
Today Daily Change % 0.24
Today daily open 78.88
 
Trends
Daily SMA20 80.14
Daily SMA50 81.52
Daily SMA100 78.36
Daily SMA200 79.67
 
Levels
Previous Daily High 79.3
Previous Daily Low 77.75
Previous Weekly High 79.56
Previous Weekly Low 76.71
Previous Monthly High 87.12
Previous Monthly Low 80.62
Daily Fibonacci 38.2% 78.71
Daily Fibonacci 61.8% 78.34
Daily Pivot Point S1 77.98
Daily Pivot Point S2 77.09
Daily Pivot Point S3 76.44
Daily Pivot Point R1 79.53
Daily Pivot Point R2 80.19
Daily Pivot Point R3 81.08

 

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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