West Texas Intermediate (WTI), the benchmark for New York-traded crude oil prices, hits the brakes late Monday and is up slightly on Tuesday, paring back some losses from the week so far ahead of U.S. crude oil supply data.
Also, on Monday, Royal Dutch Shell Plc, the biggest oil producer in the U.S. sector of the Gulf of Mexico, said it expects an installation in the Gulf of Mexico to be offline for repairs until the end of 2021 due to damage from Hurricane Ida.
The US Dollar Index (US DXY), seen as a safe haven, rose as worries about Chinese property developer Evergrande’s solvency spooked equity markets ahead of U.S. Federal Open Markets Committee’s (FOMC) begins their two-day policy meeting Tuesday ahead of its policy announcement on Wednesday afternoon (Thursday 4 am Sydney time).
Eyes will be on what U.S. Fed Chair Jerome Powell says at a post-meeting news conference Wednesday, especially concerning inflation, economic growth, interest rates and when the Fed will likely start reducing its purchases of government bonds.
Assessing the technical layout, the Relative Strength Index (RSI) 3-daily ‘lookback’ indicator holds to a negative signal, while the Moving Average Convergence Divergence (MACD) supports a positive signal.
Viewing a New York close beneath $70.45 would reinstate the bearish sentiment to $67.40-80.
Until we witness the break, a neutral view holds. No assessment is seen towards the topside.