We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bullish
GBP/USD
Bearish
USD/JPY
Bullish
Gold
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Bitcoin
Mixed
More View more
Real Time News
  • Have central banks run out of ammo? And where are central banks heading? Find out from cross-asset class trader, @JohnNetto only on Trading Global Markets Decoded #podcast with @MartinSEssex here: https://t.co/Twr44cZ1GB https://t.co/HprpRueTXH
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 97.86%, while traders in France 40 are at opposite extremes with 75.76%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/PG6QQFO8tv
  • What is market volatility and what does a market event volatility look like? Find out from @PaulRobinsonFX here: https://t.co/vg7w10la3j https://t.co/yKEBSyKbgS
  • RT @globaltimesnews: China-US #tradetalks must be based on equal footing and mutual respect. The deal must be mutually beneficial, said Chi…
  • RT @LiveSquawk: China Offers No Confirmation On US Trade Deal – WSJ https://t.co/hWUwdf4iow
  • Commodities Update: As of 11:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 1.28% Silver: 0.26% Gold: 0.13% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/La4HQtV3ur
  • Forex Update: As of 11:00, these are your best and worst performers based on the London trading schedule: 🇬🇧GBP: 1.68% 🇪🇺EUR: 0.48% 🇳🇿NZD: 0.26% 🇨🇦CAD: 0.18% 🇦🇺AUD: 0.11% 🇯🇵JPY: -0.30% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/SoW8VDJZgA
  • Indices Update: As of 11:00, these are your best and worst performers based on the London trading schedule: Germany 30: 1.32% France 40: 1.22% Wall Street: 0.55% US 500: 0.51% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/hXfpb9bT4W
  • Euro vs USD Forecast: EUR/USD Gears up to 1.1200 Handle – What’s Next? More details in the link below: https://www.dailyfx.com/forex/technical/home/analysis/eur-usd/2019/12/13/Euro-vs-USD-Forecast-EURUSD-Gears-up-to-1.1200-Handle-Whats-Next-MK.html/?CHID=9&QPID=917714 https://t.co/DkAGBJlDTH
  • Have you been catching on your @DailyFX #podcast "Global Markets Decoded"? Catch up on them now, before new episodes release! https://t.co/mk1w1DM2Rh https://t.co/gfDv4QcaZ7
Crude Oil Price Recovery Aborted as Trump Tax Plan Disappoints

Crude Oil Price Recovery Aborted as Trump Tax Plan Disappoints

2017-04-27 08:03:00
Ilya Spivak, Sr. Currency Strategist
Share:

Talking Points:

  • Crude oil prices drop with stocks on Trump tax proposal
  • Int’l Oil Summit in Paris eyed for clues about supply trends
  • Risk aversion may trim bond yields, help gold extend gains

Crude oil prices roared higher after EIA inventory data showed stockpiles shed 3.64 million barrels last week, marking a stark departure from an analogous API report that reported a small build over the same period. The move higher proved short-lived however as risk appetite soured after the White House tax reform proposal failed to impress. The WTI benchmark retreated alongside stock prices, erasing prior gains to finish the day little-changed.

The US administration released a plan closely aligned with preliminary speculation. In essence, it wants to reduce tax rates while broadening the base by eliminating most itemized deductions. The plan was relatively vague on implementation details. Importantly, there appeared to be nothing to win support from deficit hawks in the legislature. Investors seemed to take this to mean that the ambitious overhaul may suffer the same fate as the aborted AHCA healthcare reform bill.

Not surprisingly, gold prices rose as the markets digested the Trump team’s proposal. Cutting taxes was to be a key part of an expansionary fiscal posture that would buoy inflation and push the Fed to hike interest rates more aggressively. Apparent skepticism about the scheme’s legislative future has turned this logic on its head, with Treasury bond yields declining and the priced-in rate tightening path implied in Fed Funds futures flattening after its announcement hit the wires.

Asian stock exchanges managed tepid gains but European bourses are facing heavy selling pressure in early trade. The downbeat mood has spared US stock index futures thus far. If risk aversion spreads market-wide, a drop in bond yields may see gold recover further. A round of soft US economic statistics including durable goods orders and pending home sales may also help the yellow metal’s cause. Meanwhile, a gathering of oil industry bigwigs in Paris may bring headlines about on-coming supply trends.

Have a question about trading gold and crude oil? Join a trading Q&A webinar and ask it live!

GOLD TECHNICAL ANALYSISGold prices are in digestion mode having slid to a two-week low after topping below the $1300/oz figure, as expected. A daily close below the 14.6% Fibonacci expansion at 1258.62 exposes the 1235.91-41.50 area (October 7 2016 low, 23.6% level). Alternatively, a rebound that takes prices above falling trend line resistance at 1286.89 paves the way for a test of the 1295.46-1308.00 zone (April 17 high, support-turned-resistance).

Crude Oil Price Recovery Aborted as Trump Tax Plan Disappoints

Chart created using TradingView

CRUDE OIL TECHNICAL ANALYSISCrude oil prices have stalled at trend support guiding the move higher since August 2016. From here, daily close below the 48.74-85 area (trend line, 61.8% Fibonacci expansion) opens the door for a test of the 47.08-69 region (March 22 low, 76.4% level). Alternatively, a turn back above the 50% Fib at 49.78 sees the next upside barrier at 50.71, the 38.2% expansion.

Crude Oil Price Recovery Aborted as Trump Tax Plan Disappoints

Chart created using TradingView

--- Written by Ilya Spivak, Currency Strategist for DailyFX.com

To receive Ilya's analysis directly via email, please SIGN UP HERE

Contact and follow Ilya on Twitter: @IlyaSpivak

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.