* Negative data previously factored into prices -analysts
* Technicals show crude to rebound to $74.40
[]
* Coming Up: U.S. Initial jobless claims; 1230 GMT
(Adds dollar, analyst comment, RSI graphic, updates prices)
By Alejandro Barbajosa
SINGAPORE, Aug 26 (Reuters) - Oil rose for a second day on
Thursday after a five-session losing streak took prices to
11-week lows, rekindling interest on the basis of technical
indicators pointing to a rebound.
A drop of about 0.4 percent in the dollar's value against a
basket of currencies on Thursday also raised the appetite for
exposure to commodities as Asian stocks rose.
New U.S. home sales slumped to the slowest pace on record
in July and orders for costly durable goods were weak, data
showed on Wednesday, heightening fears the economy was at risk
of another downturn. []
Negative statistics also prevailed in the U.S. oil market
on Wednesday after government figures showed the nation's total
petroleum stockpiles rose to a fresh all-time high last week,
with gains across the board.
U.S. crude for October delivery <CLc1> rose 31 cents to
$72.83 a barrel by 0433 GMT, after rising more than 1 percent
on Wednesday, having touched $70.76, the lowest since early
June. Prices have dropped about $10 from a peak of almost $83
on Aug 4. ICE Brent <LCOc1> climbed 23 cents to $73.71.
"After so many days of the market losing steam, this could
be just some sort of relief rally," said Serene Lim, a
Singapore-based oil analyst at ANZ.
"It could also be that the market has already priced in
some very bad news and that is why, despite the inventory and
economic data, we could see some strength."
OVERSOLD TERRITORY
Front-month U.S. crude futures' 14-day relative strength
index (RSI) fell to just above 30 on Tuesday, a technical
indication it was nearing an oversold condition, and then
bounced on Wednesday to above 35, according to Reuters data, as
taking profits on short positions after a five-day losing spell
became attractive. For a graphic:
http://graphics.thomsonreuters.com/gfx1/ABE_20102608123008.jpg
"For bullish investors, they might want to take the
opportunity to buy at these low levels," Lim said.
Crude oil inventories at the key Cushing, Oklahoma,
delivery hub fell 779,000 barrels to 36.3 million in the week
to Aug 20, about the only bullish feature in a weekly inventory
report from the Energy Information Administration published on
Wednesday.
Markets will focus on U.S. jobless claims due out later on
Thursday and U.S. second-quarter gross domestic product due for
release on Friday.
A slowdown in the manufacturing sector as indicated by the
weak durable goods orders report "does not offer much hope for
a bounce in diesel demand heading into September," Harry
Tchilinguirian, a commodity strategist at BNP Paribas, said in
a weekly note.
"Similarly, labour markets offer scant support to gasoline
demand, and with the end of the driving season around the
corner, seasonal support will begin to fade," he added.
INVENTORIES IGNORED
Contagion from rising stock markets on Wednesday and
Thursday allowed the oil market to shrug off a
bigger-than-expected gain in total U.S. crude inventories,
which rose by 4.11 million barrels, according to the EIA.
[]
Gasoline inventories were 2.27 million barrels higher, at
odds with forecasts of a small drawdown. Distillate stocks,
which include heating oil and diesel, increased by a
larger-than-expected 1.76 million barrels.
In aggregate, commercial crude and product stocks rose to
1.139 billion barrels last week, topping the record weekly high
of 1.13 billion barrels set in the week to Aug. 13.
Also sending bearish signals, forecasters revised downwards
their expectations of the oil price both for this year and
next, a Reuters poll showed on Wednesday. []
Japan's Nikkei average rose 0.5 percent on Thursday, buoyed
by short-covering in exporters' shares after four days of falls
and as the yen pulled back slightly from a 15-year high hit
earlier this week. []
Wall Street stocks initially fell on Wednesday's negative
economic indicators, but rebounded to end slightly higher and
snap a four-day losing streak as bargain-hunters inched back
into the market.
A big high-frequency trading firm faces possible civil
charges by regulators after its computer ran amok and sparked a
frenzied $1 surge in oil prices in February, according to
documents obtained by Reuters and sources familiar with the
continuing investigation. []
Tropical Depression Seven in the far eastern Atlantic Ocean
strengthened into Tropical Storm Earl late Wednesday, the U.S.
National Hurricane Center said in its latest advisory.
[]
Early computer models show the system eventually steering
northwest toward Bermuda and away from key oil and gas
producing areas in the Gulf of Mexico, in a similar path to
that expected to be followed by Hurricane Danielle.
(Editing by Manash Goswami)
