Jump to content

Market update: Crude oil eyeing 7% drop this week so far as retail bets becoming more bullish


Recommended Posts

Crude oil prices on course for worst week since mid-March; retail traders recently turned net-long WTI, a bearish sign and prices broke under key moving averages, where too?


original-size.webpSource: Bloomberg


Daniel Dubrovsky | Currency Analyst, DailyFX, San Francisco | Publication date: Thursday 05 October 2023 05:48

Crude oil prices are on course to sink nearly 7% this week so far. If confirmed, this could end up being the worst five-day period for WTI since the middle of March. Retail traders are now increasingly boosting upside exposure. This can be seen by taking a look at IG Client Sentiment (IGCS), which could have a key influence on where the commodity goes from here.

Crude oil sentiment outlook - bearish

According to IGCS, about 57% of retail traders are net-long crude oil. Since most of them remain net-long, this hints that prices may continue falling down the road. This is as upside bets increased by 33.08% and 67.76% compared to yesterday and last week, respectively. With that in mind, the combination of overall exposure and recent changes offers a stronger bearish contrarian trading bias.

IG crude oil sentiment chart


original-size.webpSource: DailyFX

Crude oil technical analysis

On the daily chart below, WTI has confirmed a breakout under the 20-day moving average and recently closed under the 50-day moving average. However, confirmation of a breakout under the latter has yet to be achieved. That said, recent losses followed negative RSI divergence, which showed that upside momentum was fading.

From here, recent losses have exposed the 23.6% Fibonacci extension level of 81.88, which is immediate support. Further losses beyond that place the focus on the August low of 77.63. Otherwise, in the event of a turn higher, keep a close eye on the 84.84 inflection point from the August peak.

Crude oil daily chart


original-size.webpSource: TradingView




This information has been prepared by IG, a trading name of IG Australia Pty Ltd. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • image.png

  • Posts

    • Sounds like you are looking at the ask price, or the mid price. I don't have access to the 10sec data at that time, but the 1 minute candle had a low at 7947.7. Ask low was 7954.7. So I guess you had a long position; in this case look at the bid price to see what is going on.
    • What really caught my eye about ChatAI is the way it aims to go beyond the limitations of traditional social media platforms. Instead of relying on text-based or voice-based interactions alone, this project is designed to support multimodal communication, allowing users to engage through a variety of formats like text, voice, and images. ChatAI is positioning itself as a revolutionary social application that combines advanced AI capabilities with the power of decentralized technology. The core idea is to open up a new era of social interaction by leveraging cutting-edge natural language processing (NLP) to enable smooth and efficient communication. But it's not just about the technical capabilities - ChatAI also seems to have a strong focus on personalization and continuous learning. The platform is built to continuously optimize its performance based on user data, adapting to individual preferences and enhancing the overall user experience over time. I was really excited to hear the news that the ChatAI (CHATAI) token is now listed on the Bitget cryptocurrency exchange. As someone who is deeply interested in the intersection of artificial intelligence, web3 technology, and social media, this listing feels like a significant milestone for the project.
    • I could remember what happened to Binance & kucoin. This might be another slap in the face of SEC but who knows, let's see how this unfolds. 
  • Create New...