With another week comes another selection of trade ideas from Onyx Research. Our weekly Onyx Alpha report presents speculative and hedging trades based on technical analysis and data-driven tradecraft methods on Onyx Commitment of Traders (COT) and Flux Financials data.
In ‘The Officials’, Onyx Capital Advisory publishes outright values, spreads, cracks and boxes for the main energy commodities traded in the marketplace. The published values are determined independently and on a fair market basis by our team of dedicated professionals.
The Aug Brent futures contract has seen a rangebound morning, trading between $81.30/bbl and $81.80/bbl, and is currently trading at $81.46/bbl at the time of writing (11:15 BST).
Short Jul Euro Hi5 Demand for HSFO in Europe has seen a slight uptick lately, with higher bunkering requirements ahead of the summer as the main factor behind the recent HSFO strength. LSFO consumption across Northwest Europe and the Mediterranean
The Aug Brent futures flat price has had an extremely robust afternoon, initially rising from $79.75/bbl at 12:00 BST to $80.45/bbl by 13:45 BST before ticking down to $79.95/bbl at 14:55 BST.
TARGET PRICE: $78-80/bbl We expect Brent to trade on either side of $80/bbl this week, with a slight bearish bias. We are looking for the front month August contract to finish the week between $78-80/bbl. This call is predicated on
Technical indicators highlight that prices in the Aug Brent futures, ICE LS gasoil futures, and RBOB futures fell below their respective lower Bollinger bands, indicating a foray into oversold conditions before recovering towards the end of the week.
For the week to June 04, money managers significantly reduced their long positions and increased their short positions across the Brent and WTI futures benchmarks as traders reacted bearishly to the possibility of OPEC+ adding barrels back to the market.
The Aug Brent Futures contract saw a fairly muted morning in terms of price action, where it opened at $79.70/bbl and has failed to move much either way. After briefly breaking $80.00/bbl and touching $80.10/bbl at 09:04 BST, it has retraced and is now trading at $79.75/bbl as of 11:15 BST (time of writing).
Brent trumped bearish macro sentiment and the EIA stats.
The likely unwinding of stretched short positions trumped bearish drivers this week, driving Brent above our end-week target.
