The release of disappointing Chinese economic data earlier today has cast a shadow on global sentiment, instigating downturns in oil and copper prices, as well as European indices and US futures.
WTI crude oil experienced a fleeting rebound following a Reuters news alert suggesting that Saudi Arabia was extending voluntary output cut. However, the news alert was withdrawn shortly after, as it merely echoed an earlier report from June 4. Now, WTI prices are being pressured lower amid concerns over domestic demand in China and the partial restart of Libyan production that had been previously halted.
Technically, near term bias is neutral in WTI after a top was formed at 77.22, ahead of 100% projection of 63.37 to 74.74 from 66.94 at 78.1. While the stay above 55 D EMA is a near term bullish sign, i cannot be ruled out that rebound from 63.37 is merely a corrective bounce. Break of 72.57 support will argue that the rebound have completed and target 63.67 and possibly below. Nevertheless, firm break of 78.01 will add another evidence for trend reversal and target 83.46.
Copper, a commodity particularly sensitive to Chinese data, also felt the pinch. Rejection by 3.9501 resistance keep near term outlook neutral for now. While prior break of 55 D EMA is a bullish sign, upside is capped below falling trend line resistance (from 4.3556). On the upside, break of 3.9501 will resume the rebound from 3.5393 and argues that whole fall form 4.3556 has finished. However, break of 3.6706 would indicate that fall from 4.3556 is ready to resume through 3.5395.
