Crude Oil traded flat and dipped to the day's low of 5290 as pressure seen after Saudi’s oil minister stated increased oil prices were a concern, but latter in the day recovered and settled at 5324 with a marginal gain of +0.21%. Still fears over a deeper than expected slowdown in China’s economy also weighed, as investors looked forward to the conclusion of the Fed’s closely watched policy setting meeting later in the week. Saudi’s Oil Minister said earlier that global supply, demand and inventories of crude do not justify the current increase in oil prices. “The price of oil is simply not supported by market fundamentals. Prices have been well-supported amid growing expectations that central banks around the world will soon announce fresh stimulus measures to help spur weak global growth. Renewed fears over escalating violence in Syria and lingering tensions between Iran and the West have also been supporting prices in recent weeks. However, sentiment remained supported after disappointing US employment data sparked fresh expectations for QE3 by the Fed. Oil traders are now looking ahead to the Fed’s next policy meeting, which will take place on Sept 12 and 13, for more clarity on the central bank’s monetary policy. Now technically market is getting support at 5291 and below could see a test of 5259 level, And resistance is now likely to be seen at 5355, a move above could see prices testing 5387.

Trading Ideas:

Crude trading range for the day is 5259-5387.

Crude gains as supportive expectations that the U.S. Federal Reserve will act to stimulate the economy supported prices

Saudi Arabia Oil Minister Ali al-Naimi said that the recent rise in oil prices is not due to any lack of supply

U.S. crude oil stockpiles likely fell last week, with U.S. Gulf Coast oil production and imports still reeling after Hurricane Isaac