U.S. West Texas Intermediate futures are in a position to close higher for the week although trading inside last week’s range still suggests investor uncertainty and indecision. Furthermore, the price action appears to be representative of short-covering as opposed to aggressive counter-trend buying. This is understandable considering the fundamentals remain overwhelmingly bearish despite a slight shift in the narrative due to optimism over a possible trade deal between the United States and China.
Supported by Expectations of Limited US-China Trade Deal
Crude oil prices are moving higher on the last day of the week as traders grew more optimistic over the possibility of a limited trade deal between the United States and China.
Keep in mind that the entire move is based on speculation after President Donald Trump told reporters on Thursday that talks between the two economic powerhouses were going “really well.” His remarks came after he tweeted that he would meet with Chinese Vice Premier Liu He at the White House on Friday.
Traders have been growing more optimistic throughout the session on Friday, but just enough to fuel a short-covering rally. Other than speculative buying, there still isn’t any evidence that investors have flipped sentiment from bearish to bullish.
Driving the optimism at the end of the week are a series of moves by the United States and China that suggest progress is being made at the meeting. These…