Nymex crude oil closed near $74 a barrel, traded between $71-74. Crude rose for the first time in 3 days after bullish manufacturing data in the U.S. and China. The dollar closed lower losing about 0.8% and the Dow Jones closed over 220 points higher. U.S. ISM’s manufacturing index reported at 56.3 in August from 55.5 in July while new orders slowed to 53.0. China’s PMI also showed a faster pace at 51.7 in August from 51.2 in July, rebounding off 17-month lows. NHC reported that hurricane Earl has strengthened back into a Category 4 storm and threatens to bring rain and high winds. Earl is located about 815 miles southeast of Cape Hatteras, NC and could approach the east coast by Friday. NHC also reported tropical storm Fiona located about 145 miles east of the Leeward Islands, expected to follow hurricane Earl’s path. NHC is tracking a third system in the Atlantic located about 800 miles southwest of the Cape Verde Islands, forecasting an 80% to become a storm in the next 48 hours.

Energy Department reported today:

- Weekly crude imports off 202,000 bpd to 9.647 mln
- Weekly crude runs off 68,000 bpd to 14.82 mln
- Weekly product imports off 251,000 to 2.745 mln
- Weekly gasoline output up 11,000 bpd to 9.386 mln
- Weekly gasoline blend stocks up 1.1 mln bbls at 149.2 mln
- Weekly distillate output up 298,000 bpd to 3.628 mln
- Weekly heating oil output up 0.7 mln at 52.4 mln
- Gasoline demand in last 4 weeks was 9.36 mln bpd, up 1.9% y/y
- Distillate demand in last 4 weeks was 3.66 mln bpd, up 7.8% y/y
- Total product demand in last 4 weeks was 19.57 mln bpd, up 1.4% y/y
- Crude stocks at Cushing, OK off 503,000 barrels at 35.75 mln

Crude Oil:

Crude closed $1.99 higher gaining over 2.7% today. Crude closed higher after speculation that demand will increase on positive government data despite a +3.4 mln build in stock. Support level will stay at $70 and resistance will also stay at $80 for the moment. Chart pattern couldn’t confirm last week’s bull trend and prices may chop around at these levels. Indicators have rebounded off oversold levels as volume starts to pick up. Best opportunity is to day-trade as the U.S. driving season nears the end. Also, use stop orders to limit the risk.