Previous Week Capsule
While everyone was presuming the hitches in total demand of crude oil is going to thrust the MCX Crude Oil prices open on a gap down note but supply concerns after attacks on Iranian oil tankers outperformed and it opened on a gap up note at 3,898 levels. However, the reluctance shown by China’s administration on U.S-China ‘Phase one’ as they were considering for further discussions before closing the truce weighed pressure on prices as it slipped to 3,750 levels. Weakening of China’s factory gate prices reported by China’s National Bureau of statistics continued to hammer down the black gold prices but optimism of Brexit deal continued to provide a cushion at lower prices.
As per the EIA Report, crude oil inventories reported a buildup of 2.297 million barrels last week. The greenback government reported that the U.S. stockpiles now stand at 435.129 million barrels on Oct 04.
Major Concern this week
The recent closure of Brexit deal keeping the interest of European Union and Britain intact has pushed the prices of MCX Crude Oil higher along with the markets of global and other Asian economies will continue to keep the bulls on the driving seat. Saudi’s commitment to do ‘whatever it takes’ to keep the oil market stable would help to remove the lid over the rally.
API Forecast this week
As per the weekly American petroleum Institute (API) storage report a marginal increase by 10.500 million barrels is expected today to 445.629 million till October 11 is reported by them that might push the black gold prices lower.
Advisorymandi’s Forecast (Time Series)
After incorporating the Three weeks and Five Weeks Exponential Time –Series Forecasting in the previous 11 weeks crude oil inventories data reported by Energy Information Administration, we are expecting that resulted stockpiles of crude oil could surge by 2.813 million per barrels or 0.517 million per barrels respectively. In order to filter the time period, we have employed a Root Mean Square Error method (RMSE), which is pointing out for Three Weeks Exponential Time Series Forecast, according to which, the Crude Oil Inventories is expected to plunge by 2.813 million per barrels making it a total stock piles of 437.942 million per barrel in reserves of U.S. government.
Intraday Trading Strategy
On hourly scale, MCX Crude Oil is trading near the lower portion of ‘Symmetrical Triangle’ that usually signals for indecisive movement but trading near lower portion provides a buying opportunity. RSI is trading back and forth in a range of 40-60 levels. We are expecting a breach of 3,796 levels will push the prices to a high of 3,838 and 3,860 levels respectively.