May Crude Oil rallied during the Wednesday night session for Thursday, April 7. Itreached its high for the day at 38.30 getting some upside follow through from the surprise drawdown in overall inventories from Wednesday’s EIA Report. The high was right at resistance (38.39). Crude oil reversed from here and headed toward Wednesday’s low of 36.43. It couldn’t quite make it trading to 36.69. Crude recovered and rallied into the close, settling at 37.26. It continued to grind higher during the after settlement session and ended the day at 37.53. Thursday was a day without headlines and Crude has relied on bullish headlines from OPEC for the rally from the February lows (26.05). OPEC is trying to push Crude OIL higher while keeping its production at high levels. It has accomplished this by constantly talking up a production freeze meeting to keep production at January levels first in March, and when that meeting failed to materialize, for this month. The meeting is to be held in Doha, Qatar on April 17th and it is to include OPEC and non OPEC major producers.  The goal is to get Crude to rally to a $45 – $50 range, high enough to satisfy their budget needs, but low enough to prevent US Shale producers from coming back online. The push for the meeting has come from the smaller OPEC producers. They are suffering the most from the low oil prices and are desperate to get price moving higher toward the levels I mentioned earlier. Russia has increased their production to 10.9 million barrels per day in March. It is at a 30 year high. Saudi Arabia has said it will freeze production if Iran does the same. These are the two producers that matter. If they don’t commit the meeting will be a waste of time. But the meetings potential has provided some bullish headlines. In the long run that is all OPEC cares about….keeping the rally going while maintaining production.

   High 38.30                     

 Low  –  36.69                             

 Last  –  37.53                               

Daily Pivots for 4/8/16:           

R2

39.18

R1

38.46

PIVOT

37.57

S1

36.85

S2

35.96

     

                           

                                        

                          
For those interested I hold a biweekly livestock webinar on Wednesday April 13, at 3pm. It is free for anyone who wants to sign up and the link for sign up is below. If you cannot attend live a recording will be sent to your email upon signup.

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