WTI slips on demand woes and orange juice on supply hopes while silver recovers
Outlook on WTI, silver and orange juice as US factory activity shrinks and OPEC+ cuts its output further still.
WTI slips back as investors mull outlook
WTI’s recent advance ran out of steam close to its May-to-July downtrend line and 55-day simple moving average (SMA) at $71.88 to $71.96 despite Saudi Arabia announcing that it would prolong its 1 million barrel per day (bpd) voluntary output cut until the end of August. Worries about slowing US factory activity trumped additional Russian oil export reductions by 500,000 bpd next month which brings the total amount of output cuts by OPEC+ members to 5.16 million bpd as the group of major oil producers tries to shore up prices.
Little trading volume is expected to go through the oil markets on Tuesday as the US is celebrating its 4 July holiday. A slip through Monday’s low at $69.77 could lead to the mid-June low at $68.15 being revisited. Immediate resistance sits at Thursday’s high at $70.65, followed by Friday’s high at $71.10 and then Monday’s peak at $71.82.
Silver price back above the 200-day simple moving average
The price of silver continues to oscillate around the 200-day simple moving average (SMA) at $22.62, as it has done over the past week, inversely mimicking US dollar moves. Last week’s high at $23.10 is currently in sight, a rise above which would engage the early to mid-June lows at $23.22 to $23.25. Further up lies the May-to-June downtrend line at $23.48. Slips should find support along the 200-day SMA at $22.62.
Orange juice falls through uptrend line
Front month orange juice futures gapped lower and now trade below their January-to-June uptrend line at $2.5455 as supply of oranges seems to be picking up again. The early June low at $2.4909 is now within reach, a fall through which would have medium-term negative implications and target the May trough at $2.3807. Resistance can be spotted at this week’s $2.5232 to $2.5388 gap on the daily chart and along the breached 2023 uptrend line at $2.5455. The medium-term downtrend remains in play while last week’s high at $2.6572 isn’t overcome. Below it, the June resistance line and 55-day simple moving average (SMA) can be spotted at $2.6070 to $2.6253.
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