Crude Oil trimmed losses and settled at 5048 that
is down by Rs.35.00 after testing a low of 5003 earlier in the day but
recovered following a US
government report on oil supplies.
EIA said in its weekly report that US crude oil inventories rose by 2.1mbls in the week ended May 11, above
expectations for a 1.7mbl increase. Despite the higher than expected
build, markets blew a sigh of relief as the government
report came a day after the API said that US crude inventories soared by
6.6mbls last week.
Oil prices were sharply lower before the supply
data as investors cut their exposure to growth linked assets amid mounting
fears over the possibility of a Greek exit from the euro
zone. Oil futures have been on a rapid decline since the outcome of the May 6
elections in Greece,
which threw the future of bailout deal into doubt and fuelled fears over a
possible Greek exit from the euro zone.
There are worries that the region’s sovereign debt crisis could trigger a broader economic slowdown that would curb demand for oil. Rising
Saudi Arabian and Libyan output and signs of slower US economic and employment
growth, helped pull oil prices back from Q1 highs.
Now technically market is in
oversold as RSI for 18days is currently indicating 28.62, where as 50DMA is at
5365 and crude is trading below the same and getting support at 4994 and below
could see a test of 4940 level, And resistance is now likely to be seen at
5111, a move above could see prices testing 5174.
Crude trading range for the day is 4940-5174.
Crude oil prices fell a
fourth-consecutive day as U.S.
crude inventories stood at a 22-year high.
OPEC officials have said they want to drive price
of oil to $100 as there are worries over potential demand destruction.
EIA report showed U.S. crude oil inventories jumped
by 2.10 million barrels
Silver continued heading lower amid encouraging
dollar as support seen from ongoing concerns of
eurozone, yesterday silver opend at 52819 and dipped towards 51201 as investors
continued to pile in to the dollar amid growing
concerns over political turmoil in Greece.
Silver prices updates have been on a rapid
decline since the outcome of the May 6 elections in Greece threw the future of the
country’s international bailout deal into doubt and fuelled fears over a
possible Greek exit from the euro zone. Speculation
over the possibility of a Greek exit from the euro zone intensified, as talks
aimed at forming a coalition government failed.
A caretaker govt will be appointed, with new
elections likely in early June, fuelling fears over a potential Greek default
and eventual exit from the euro zone. Although bullion’s appeal as a safe haven
is boosted during times of economic uncertainty, the
euro zone’s debt crisis has done little to bolster appetite for the precious metal.
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