A decline in Crude Oil Futures appears to be unlikely
Crude Oil Prices Drop as Traders Reduce Positions
Traders Sell Contracts
CME Group, a company that deals with crude oil futures markets, recently released data showing that traders have been selling their contracts. They reduced their positions by about 2,600 contracts on Wednesday. This is a change from the previous day when they were buying more contracts.
Although traders were selling contracts, the volume of trading actually increased. This means that more people were buying and selling crude oil futures contracts. In fact, the volume increased for the second day in a row, with an additional 105,700 contracts being traded.
Oil Prices Drop
As a result of traders selling their contracts, the prices of West Texas Intermediate (WTI) crude oil dropped significantly on Wednesday. The prices were close to the 55-day Simple Moving Average (SMA) of around $84.00. This means that the value of crude oil decreased. However, it’s important to note that this decline may not continue for a long time.
If the prices continue to drop, the next level of support to watch out for is the low price of $77.64, which was recorded in August on the 24th. This means that if the prices reach this level, they may not drop much further.
In summary, traders have been selling their crude oil futures contracts, which has caused the prices to drop. However, the volume of trading has increased, indicating that there is still interest in buying and selling crude oil. It will be interesting to see how the prices develop in the coming days.