Crudeoil yesterday settled down -0.74% at 5763 trading near to $96 a barrel ahead of China data that may confirm a further economic slowdown in the second quarter, dampening the growth outlook for fuel demand in the world's second largest oil consumer. Growth in China's vast factory sector may have stalled in June as domestic and external demand weakened, boding ill for broad economic prospects in the second half. The Fed's eventual decision to scale back its asset purchases must be based on the overall economic progress since it launched the stimulus and not be "excessively sensitive" to the most recent economic data, a top Fed official said. While Hedge funds and other large speculators slashed their bets on rising US crude oil prices in the seven days to June 25, regulatory data showed on Friday, cutting them from a two-year high hit the previous week. Also OPEC crude output fell in June due to disruptions in Libya and Nigeria, inadvertently bringing supply closer to the organization's target. The top US energy official said he believed the oil market could cope with any further reduction of Iran's oil exports from the tightening of sanctions on Tehran over its nuclear programme. While Mexican crude oil production slid to its lowest level in nearly two years in May, while exports were their weakest in more than two decades, official data showed. For the quarter, however, oil declined nearly 1%, as a combination of concerns over an end to the Fed's assets purchase program and fears over a deepening slowdown in China weighed. Technically market is getting support at 5748 and below same could see a test of 5732 level, And resistance is now likely to be seen at 5790, a move above could see prices testing 5816.

Trading Ideas:

Crudeoil trading range for the day is 5732-5816.

Crude oil dropped as investors looked to U. S. economic data as a gauge of oil demand.

Oil came under pressure from stronger dollar as investors resumed pricing in the possibility that the Fed will begin to pare back its bond-buying program

Traders were also watching ongoing turmoil in Libya and other oil-producing regions, as well as a North Sea outage.