Long profit taking, crude oil market or gaining momentum

When the risk comes, investors habitually choose to take profits. In late July, the price of WTI crude oil in New York continued to fall, which seems to reverse the strong rebound in the previous period. As of 17:00 on July 31, the price of WTI crude oil was reported at 103.24 US dollars per barrel. Market participants analyzed that due to concerns about the Fed's quantitative easing policy or the number of changes in the market, the market bulls profited, but the interest rate decision is not new, and US crude oil is expected to gain momentum.

 

 

Nearly 5% in 7 trading days

 

A month ago, New York oil prices broke through $100 per barrel after many “roller coaster” prices, and opened a strong rebound. On July 19, it once reached a high of 108.93 US dollars. Also on July 19, New York oil prices began to fall, as of July 30, the low point reached $102.67.

 

For the fall in oil prices, the analysis of profit-taking is quite market-recognized. Cheng Xiaoyong, an analyst at Baocheng Futures, said that the oil price correction is a technical adjustment. The previous international crude oil, especially WTI crude oil, has risen too sharply and profited more. At the same time, China's economic growth slowed more concerns, whether it is HSBC China's manufacturing PMI preview value, or the decline in profit growth of enterprises above designated size in January-June, which has increased market pressure. The fundamentals of commodities are complementary to price fluctuations, the most important of which is to consider absolute prices. When the indicators of the fundamentals gradually rise, the prices also rise together, and then the indicators remain stable, without new positive support, the momentum of future price increases will be weakened.

 

Guo Dan Junan Futures analyst Dong Dandan believes that the current crude oil market is such a pattern, the US oil consumption rose from 18 million barrels / day to 19.5 million barrels / day, the refinery operating rate rose from 83% to 93%, these indicators are There has been a situation of high stability, and the current callback of WTI crude oil, in addition to the factors of stabilization of demand, the reduction of speculative funds is also a large part of the reason. The CFTC's net long position reached its highest level since the 2006 record on Tuesday (July 23), and even if the speculative funds increased again in the week, the futures price will only be high and the decline in speculative buying will gradually arise. Price adjustment.

 

The spread between the two places is once again opened

 

In the early stage, international oil prices continued to rise due to geopolitical factors and the boost in the peak consumption season. Beijing mid-term futures analyst Yan Xiaoying said that the recent market news is relatively scarce compared with the previous period. The influence of geopolitical factors on oil prices is gradually weakening. At the same time, oil prices have technical repair demand after the continuous rise, so the recent oil price has a weak correction.

 

Since July, the price difference between Brent crude oil and WTI crude oil has been falling. The WTI broke through the $100 mark at the beginning of the month and went straight to the high of $108, which smoothed the spread between the two. However, this situation has not continued. As of press time, the spread between the two places is about $3 per barrel.

 

Some market participants believe that for crude oil, as long as the situation in the Middle East is not deteriorating, the callback will continue and the spread of WTI and Brunt crude oil will expand again. Wanda Futures analysts pointed out that the increase in US crude oil production and the increase in domestic crude oil capacity have led to a reduction in the use of Brent-grade crude oil in the United States, while South Korea, the third-largest crude oil importer, no longer supports freedom in early July. Traders' export tax rebates of 3% of the trading countries to cover the tariff loopholes have hit the demand for Brent-grade crude oil, and the weakening demand for Brent crude oil has made the Brent oil price rise weaker than WTI oil prices in July. In the future, as the US production and capacity increase, the spread between the two may continue to change, and WTI oil prices may further increase.

 

Short-term gains and chances of rising again

 

The overnight risk event has made the markets such as crude oil and gold cautious. However, most analysts believe that risk events and the Fed's interest rate adjustments and economic indicators will only affect commodity prices in a short period of time, and the real trend will still fluctuate depending on the supply and demand side of the commodity itself.

 

Dong Dandan believes that economic data is an indication of the current economic situation, and the economic situation has already been reflected in the supply and demand of crude oil. The Fed’s loose monetary policy is a confirmation of a strong economic recovery, while the US accounts for 20% of global crude oil consumption, which will support crude oil prices.

 

However, business analyst Li Hong said that short-term seasonal factors, crude oil prices may still go up, but due to the limited support of supply and demand fundamentals, in the fourth quarter, crude oil continues to move up the space is not large.

 

If you look at the top of this year's oil price, $110 a barrel is likely to be the highest point of this year's oil price, and it is hard to break through later. Yan Xiaoying said that because the current traditional consumption season in the summer season, the US oil consumption reached the highest peak in the year, and the previous geopolitical factors continued to affect the formation of oil prices, which caused the oil price to approach 110 US dollars, but failed to form a breakthrough. There is only one month left in the peak season, and the oil price is still on the way back, while the consumption in the fourth quarter will return to the weak, so it is difficult for the later oil price to break through this point. The bottom of this year is expected to be around US$85, which is also the lower edge of the entire first half of the volatility range. When the consumption season ends, oil prices will return to this volatility range, but the global economic situation will improve in the second half of the year. Under the support, oil prices may not fall below the low level of the first half.