WTI/USD – US Crude Steady, US Consumer Confidence Next

US crude has edged higher in the Thursday session. In North American trade, US crude futures are trading at $52.81. Brent crude futures are trading at $55.52, as the Brent premium stands at $2.71. On the release front, unemployment claims dipped fell to 234 thousand, well short of the forecast of 249 thousand. On Friday, the major event in the US is UoM Consumer Sentiment,with an estimate of 97.9 points.

US Crude stockpile reports continue to point to surpluses. Crude Oil Inventories made a splash on Wednesday, soaring 13.8 million barrels, according to the Energy Information Administration (EIA). The indicator has recorded five straight surpluses, easily exceeding forecasts on each occasion. The huge gain also marked the highest surplus since late October. Crude posted sharp losses on Tuesday, following the release of the API inventories report, which predicted a surplus of 14.2 million, compared to a forecast of 2.38 million. US crude prices are down close to 2 percent this week, as US oil production continues to increase. The EIA says that US production in 2017 will be the highest since 1970, so cuts from OPEC and Russia may not lead to higher oil prices, as more US oil reaches the markets.

EIA Reports 13.8 Million Barrels Last Week

During the US election campaign, Donald Trump hammered away at the ills of the US economy, but was short on specifics as far as remedies. However, he did promise a significant fiscal boost through infrastructure spending and tax cuts. This led to a post-election euphoria in the markets and boosted the US dollar. Fast forward to February, and optimism has been replaced by caution and unease, as Trump continues to entangle himself in controversy, both with US trading partners and at home, with the media and Supreme Court. The markets are disappointed that Trump has not unveiled an economic plan or blueprint, limiting himself to protectionist rhetoric which has sent alarm bells ringing worldwide. On Wednesday, Goldman Sachs forecast that the administration won’t implement tax reform or infrastructure spending before 2018. If so, markets may have to wait a while longer before Trump puts an economy policy in place.

WTI/USD Fundamentals

Thursday (February 9)

• 8:30 US Unemployment Claims. Estimate 249K. Actual 234K
• 10:00 US Final Wholesale Inventories. Estimate 1.0%
• 10:30 US Natural Gas Storage. Estimate -155B
• 13:01 US 30-y Bond Auction
• 13:10 US FOMC Member Charles Evans Speaks

Friday (February 10)

• 10:00 US UoM Consumer Sentiment. Estimate 97.9

*All release times are GMT

*Key events are in bold

WTI/USD for Thursday, February 9, 2017

WTI/USD February 9 at 11:45 EST

Open: 52.53 High: 53.21 Low: 52.47 Close: 52.81

WTI USD Technical

WTI/USD showed limited movement in the Asian and European session. The pair posted small gains but then retracted in North American trade

• 52.22 remains a weak support level
• 58.32 is the next resistance line
• Current range: 52.22 to 58.32

Further levels in both directions:

• Below: 52.22, 46.54, 40.57 and 33.22
• Above: 58.32, 65.05 and 72.99

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