Crude Oil Under Pressure, Tests $58 Level

U.S. crude has posted small losses in the Tuesday session. Currently, crude is trading at $58.59, down $0.11 or 0.20% on the day. Brent crude is trading at $65.00, down $0.14 or 0.21%.

Will IMF Forecast Affect Oil Prices?

The International Monetary Fund (IMF) released its most recent global growth forecast on Monday. The IMF tweaked its 2020 forecast downwards, from 3.4% to 3.3%, citing slower growth in India and other emerging economies. Still, the 2020 forecast remains significantly stronger than 2019, which came in at 2.9 percent. The revised growth projection was presented at the World Economic Forum in Davos, Switzerland. IMF managing director Kristalina Georgieva sounded positive about the forecast, noting that “after a synchronized slowdown in 2019, we expect a moderate pickup in global growth this year and next.” Despite the IMF putting a brave face on global growth, investors remain concerned about global economic conditions, as a continuing global recession could weigh heavily on crude prices.

Iran On Agenda at World Economic Forum

With a light calendar for fundamentals this week, investors will have plenty of time to follow the World Economic Forum (WEF). The summit hosts global political and business leaders and U.S. President Trump is in attendance. With leaders expected to discuss pressing global issues such as the crisis with Iran, investors keeping an eye on oil prices will be monitoring developments at the WEF. The recent flare-up between Iran and the United States saw crude prices spike upwards, only to quickly give up these gains.

Technical Analysis

The line of 58.75 remains fluid and is currently an immediate resistance line. Close by, the 50-EMA line is touching the candlesticks at 58.95. Above there is resistance at the round number of 60.00. On the downside, there is support at 58.00. This is followed by support at 57.25.