An extremely noisy headline day saw oil prices end lower as the US-China trade war showed no signs of letting up.
“Oil prices are getting whipsawed by the stock market, day-to-day, hour-by-hour, minute-by-minute,” said Walter Zimmerman, chief technical analyst at ICAP Technical Analysis.
“We tend to forget how much economic expectations are in the price of crude oil and refined products.”
But for now, all eyes (and algos) will be on inventory data.
Crude +4.13mm (+1.7mm exp)
API reports a fourth weekly crude inventory build (bigger than expected 4.13mm vs 1.7mm exp) but the major product draws prompted buying in WTI futures...
WTI fell back below $53 after the Powell/China Visa headlines (with an extreme flash-crash briefly tagging a $51 handle) and the algos went crazy initially on the API print before pushing higher...
“The market has kind of taken a bearish tone on fears that the economy will weaken,” said Bill O’Grady, chief market strategist at Confluence Investment Management LLC in St. Louis. “That has become the dominant narrative.”