US crude oil
US active crude oil (UWTI) (USO) (OIIL) futures contracts for August delivery closed at $46.8 per barrel on July 12, 2016. That was 8.6% below their 2016 closing high of $51.23 on June 8, 2016. US crude oil prices rose 4.6% on July 12, 2016, which could be a result of easing Brexit fears and short covering by traders. The US Dollar Index also fell 0.13% to close at 96.4 on July 12, 2016.
We’ll look at the relationship between the US Dollar Index and crude oil prices later in this series.
In this series, we’ll analyze the impact of fundamental drivers such as the rig count, inventory, and the US Dollar Index on crude oil prices.
Key moving averages
Currently, crude oil futures are trading 8.7% above their 100-day moving average and 1.8% below their 20-day moving average. Prices below the 20-day moving average indicate a short-term bearish sentiment for crude oil. The above graph shows the price performance of crude oil futures relative to key moving averages.
Bonanza Creek Energy (BCEI), Clayton Williams Energy (CWEI), Bill Barrett (BBG), Triangle Petroleum (TPLM), Whiting Petroleum (WLL), and Energy XXI (EXXI) are oil-weighted stocks. They have at least 60% production mixes of crude oil. They’re impacted by movements in crude oil prices.
Crude oil sentiments also affect ETFs such as the United States Brent Oil ETF (BNO), the PowerShares DWA Energy Momentum ETF (PXI), the Vanguard Energy ETF (VDE), and the ProShares UltraShort Bloomberg Crude Oil (SCO).
In the next part of the series, we’ll see how rig counts are impacting oil prices.