Delayed - 10/15 08:40:27 pm

Renewed interest in the black gold

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04/02/2013 | 03:51 pm
Opinion : Bullish above 90.2 
Target price : 100 
The U.S. WTI crude barrel is gradually approaching its highest level since September 2012 around 100 dollars, investors are betting especially on an acceleration of the economic activity in the United States, world’s largest consumer of crude oil. Oil stands apart, indeed, over the last few days from other assets and particularly from the euro which remains near to a four-month low against the dollar due to concerns about the Cyprus’ bailout and a difficult Italian’s auction. However, this increase of the dollar against the euro is significantly unfavorable for the black gold. Paradoxically, an inverse correlation is taking shape.

Oil prices remain well oriented at the end of this quarter, despite a rise in the weekly Crude Oil inventory sharper than expected. Investors are more taking in account the recent series of good macroeconomic indicators, in the image of the sharp rise in Core Durable Goods Orders, and favorable for the future domestic consumption of oil.

The barrel of crude oil seems to be regaining its momentum, which could be confirmed if the U.S. and Chinese growth would accelerate in the next months.

Technically, the situation is now slightly bullish in daily data above the USD 92.6, threshold coinciding with the 20-day moving average. Crude oil prices could quickly reach the USD 100 symbolic level then the USD 110 by extension.

We can play the continuation of this bullish trend thanks to the Crude Oil Future (Code: CLXXXX) on the Nymex futures market.
Rodolphe Steffan
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