Mitrade Insights is dedicated to providing investors with rich, timely and most valuable financial information to help investors grasp the market situation and find timely trading opportunities.

2021

Best News & Analysis Provider

FxDailyInfo

2022

Best Forex Educational Resources Global

International Business Magazine

Insights

News

Commodities

Crude Oil rally stumbles after Fed leans away from rate cuts, WTI falls back below $78

Source Fxstreet

Crude Oil markets rose on Wednesday before trimming gains post-Fed.
WTI peaked near $79.00 per barrel before falling back into the day’s range.
Odds of two rate cuts in 2024 are evaporating, crimping risk appetite.

West Texas Intermediate (WTI) US Crude Oil rose through Wednesday’s early trading, hitting a fresh June high near $79.00 per barrel before slumping back below $78.00 after the Energy Information Administration (EIA) reported another buildup in US Crude Oil supplies coupled with another Federal Reserve (Fed) rate hold.

Fed Chairman Jerome Powell hit markets with a cautious tone on rate cut expectations, noting that inflation progress still has a lot of progress to make before the Fed will be confident enough to cut rate. The Federal Open Market Committee (FOMC) has trimmed expectations of rate cuts, with the FOMC’s Summary of Economic Projections (SEP) or “dot plot” expecting only a single quarter-point cut in 2024 according to the median projection.

Broader market sentiment tilted firmly into the bullish early Wednesday after US Consumer Price Index (CPI) inflation cooled faster than expected in May, with headline CPI inflation easing to 0.0% MoM compared to the forecast tick down to 0.1% from the previous 0.3%, and YoY Core CPI inflation also eased to 3.4% versus the forecast 3.5% and last of 3.6%. Market hopes for a September rate cut of at least 25 basis points peaked over 70% in the early US trading session before Fed caution swamped out sentiment.

The Energy Information Administration (EIA) reported another unexpected buildup in US Crude Oil Stocks Change for the week ended June 7, adding 3.73 million barrels to the previous week’s 1.233 million, washing out the forecast contraction of -1.55 million.

WTI technical outlook

WTI peaked just shy of $79.00 per barrel on Wednesday before facing a technical rejection from a descending trendline drawn from 2024’s peak bids at $87.12, and near-term strength goes to the bears. However, technical support comes from the 200-hour Exponential Moving Average (EMA) rising into $76.60 and could limit downside momentum.

Wednesday’s bullish peak ran aground of heavy resistance from the 200-day EMA at $78.83, and US Crude Oil’s recovery from near-term lows near $72.45 could face another turn lower.

WTI hourly chart

WTI daily chart

WTI US OIL

Overview
Today last price	78.06
Today Daily Change	0.21
Today Daily Change %	0.27
Today daily open	77.85

Trends
Daily SMA20	77.27
Daily SMA50	80.18
Daily SMA100	79.2
Daily SMA200	79.31

Levels
Previous Daily High	78.04
Previous Daily Low	76.92
Previous Weekly High	77.36
Previous Weekly Low	72.46
Previous Monthly High	81.25
Previous Monthly Low	76.04
Daily Fibonacci 38.2%	77.34
Daily Fibonacci 61.8%	77.61
Daily Pivot Point S1	77.17
Daily Pivot Point S2	76.48
Daily Pivot Point S3	76.05
Daily Pivot Point R1	78.29
Daily Pivot Point R2	78.72
Daily Pivot Point R3	79.41

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

Recommended Articles

The Fed will sit still on October 28 — but 100 of 100 economists now expect a December hike A Reuters poll run October 16-20 found 94 of 100 economists expecting the Fed to hold at 3.75-4.00% on October 28 — and all 100 expecting a hike in December, against less than half a month earlier. The market is close to the same price, with CME FedWatch at roughly 17% for October and 82.8% for December. With the Fed in blackout since October 17, here are the five dates that decide the rest of the year, what each one is priced for, and the two directions each can take.

Author Irene Q.

Oct 22, Thu

A Reuters poll run October 16-20 found 94 of 100 economists expecting the Fed to hold at 3.75-4.00% on October 28 — and all 100 expecting a hike in December, against less than half a month earlier. The market is close to the same price, with CME FedWatch at roughly 17% for October and 82.8% for December. With the Fed in blackout since October 17, here are the five dates that decide the rest of the year, what each one is priced for, and the two directions each can take.

Big Tech's $800 billion AI bill faces its first real test — free cash flow is the judge Alphabet and Microsoft report after the close on October 28, Amazon on October 29, with hyperscaler AI capex running near $800 billion a year. Meta's negative free cash flow and 9.40% drop on October 22 was the warning; this week's prints decide whether cloud growth and backlog can pay for the buildout. Here are the consensus numbers, the free-cash-flow table and the two-sided test.

Author Irene Q.

Oct 26, Mon

Alphabet and Microsoft report after the close on October 28, Amazon on October 29, with hyperscaler AI capex running near $800 billion a year. Meta's negative free cash flow and 9.40% drop on October 22 was the warning; this week's prints decide whether cloud growth and backlog can pay for the buildout. Here are the consensus numbers, the free-cash-flow table and the two-sided test.

Anthropic files for a $2 trillion IPO — the $80.7 billion loss is the decoy, the $450 billion compute bill is the risk Anthropic publicly filed its S-1 on October 26, revealing $16.29 billion of first-half revenue (+1,304% year over year) and a $80.7 billion net loss — of which $72.4 billion is a non-cash convertible-note charge. The real number is the $450 billion of signed, mostly non-cancelable compute commitments. Here is what the filing says, why NVDA, ARM and MU are the tradeable read-through, and the conditions that decide whether the AI trade passes its first public valuation test.

Author Irene Q.

Oct 27, Tue

Anthropic publicly filed its S-1 on October 26, revealing $16.29 billion of first-half revenue (+1,304% year over year) and a $80.7 billion net loss — of which $72.4 billion is a non-cash convertible-note charge. The real number is the $450 billion of signed, mostly non-cancelable compute commitments. Here is what the filing says, why NVDA, ARM and MU are the tradeable read-through, and the conditions that decide whether the AI trade passes its first public valuation test.

Fed October Rate Decision Preview: Rate Hike Pause Has Become Consensus, How Will US Stocks, Dollar, and Gold React?The Federal Reserve will announce its October interest rate decision at 14:00 Eastern Time on October 28, and Fed Chair Warsh will hold a press conference at 14:30. Markets currently wide

Author TradingKey

Oct 27, Tue

The Federal Reserve will announce its October interest rate decision at 14:00 Eastern Time on October 28, and Fed Chair Warsh will hold a press conference at 14:30. Markets currently wide

Brent's $115 front month sits $4.6 above January — the $14 spread to WTI is the supply-risk premium December Brent trades at $115.29 while January is $110.71, a $4.58 backwardation. The December Brent-WTI spread is $14.2, versus a $3-5 normal. That gap, not the headline, is where the Middle East supply risk is priced. Here is what the curve says, why the December contract's expiry on October 30 will mechanically cut the headline by $4.6, and the 108.81 neckline that decides the next move.

Author Irene Q.

19 hours ago

December Brent trades at $115.29 while January is $110.71, a $4.58 backwardation. The December Brent-WTI spread is $14.2, versus a $3-5 normal. That gap, not the headline, is where the Middle East supply risk is priced. Here is what the curve says, why the December contract's expiry on October 30 will mechanically cut the headline by $4.6, and the 108.81 neckline that decides the next move.

Related Instrument