The price of Crude oil fell -$1.15 or -1.30% to $80.76. The decline is attributed to weak growth in China, the world’s No.1 oil importer, raising demand concerns.
The expectations that former Pres. Trump will win the November may also be a contributor as he is pro-drill and critical of the Biden administration regarded drilling and regulation on drilling.
China’s economy grew by 4.7% in Q2, the slowest pace in five quarters, due to a debt crisis in the real-estate sector, slowing consumer demand, and high youth unemployment.
The drop in oil prices persists despite rising hopes for a U.S. interest-rate cut (which can lead to higher demand and higher prices) after Federal Reserve Chair Jerome Powell expressed confidence that inflation is slowing towards the central bank’s 2% target rate.
Not so bearish for oil is technically, the price did break below the 100-day MA near $80.56 (see blue line in the chart below) but could not sustain downside momentum and is settling above the MA level.
In the new trading day, getting back below the level and also the natural support at $800 is needed to keep the sellers happy. Dip buyers, your hope is stay above $80.56 or more conservatively above $80.
This article was written by Greg Michalowski at www.forexlive.com.
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