News & Analysis at your fingertips.

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. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Mixed
Oil - US Crude
Mixed
Wall Street
Bearish
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
Gold
Bullish
GBP/USD
Mixed
USD/JPY
Bullish
More View more
Real Time News
  • With less than 24-hours to go until the FOMC announcement, here's an interesting statement from the New York Fed trading desk on 'testing operational readiness to implement existing and potential policy directives' and a planned sale of agency MBS up to $180-million. $USD $DXY https://t.co/HjpzcxGmLp
  • So has Elon been tweeting dog pictures again? Shiba Inu (SHIB) +28% in the last couple of hours….
  • Commodities Update: As of 18:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 0.09% Gold: -0.49% Silver: -0.77% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/C70e8Sd0wE
  • US Senator Mitt Romney: I am very optimistic about the bipartisan infrastructure plan $USD $DXY
  • USD/CAD hits its highest level in a month, briefly trading above 1.22 prior to Wednesday's FOMC meeting $USDCAD https://t.co/KEneo86LsS
  • WTI crude oil has room to rally further. Around the 77 mark lies substantial long-term resistance. Get your #crudeoil market update from @PaulRobinsonFX here:https://t.co/BxaHvWsLwV https://t.co/MNfIOlhNSv
  • IG Client Sentiment Update: Our data shows the vast majority of traders in USD/CHF are long at 75.59%, while traders in France 40 are at opposite extremes with 80.14%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/eNuFA54avs
  • Markets are trading like the Fed is tomorrow and Ronaldo is on the TV scoring goals. How many people are going to watch the US close vs France-Germany?
  • webinar starting right now https://www.dailyfx.com/webinars/643096611 pre-FOMC price action setups around the $USD. Topics - 1. usd setups ahead of the fed 2. expectations on taper and what's in store for tomorrow 3. gold and oil, commodities the focal point https://t.co/ZI4AoW1rOn
  • Indices Update: As of 18:00, these are your best and worst performers based on the London trading schedule: FTSE 100: 0.09% France 40: 0.07% Germany 30: 0.01% US 500: -0.18% Wall Street: -0.25% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/Y0JC4KGfgb
Oil Price Susceptible to Rise in US Output Following OPEC JMMC Meeting

Oil Price Susceptible to Rise in US Output Following OPEC JMMC Meeting

David Song, Strategist

Oil Price Talking Points

The price of oil appears to be stuck in a narrow range as the Organization of the Petroleum Exporting Countries (OPEC) plan to gradually restore production over the coming months, but the broader outlook warns of a larger correction in crude as it snaps the upward trend carried over from last year.

Advertisement

Oil Price Susceptible to Rise in US Output Following OPEC JMMC Meeting

The price of oil attempts to push back above the 50-Day SMA ($59.88) after trading below the moving average for the first time since November, and crude may continue to consolidate following the OPEC Joint Ministerial Monitoring Committee (JMMC) meeting as the update to the production adjustments table reveals plans to slowly unwind the production cuts in response to COVID-19.

Image of OPEC production table

Source: OPEC

It seems as though OPEC and its allies are in no rush to switch gears as the group pledges “to assess market conditions and decide on production level adjustments for the following month, with every adjustment being no more than 0.5 mb/d,” and it seems as though OPEC+ will continue to regulate the energy market in 2021 as “the volatility observed in recent weeks warrants a continued cautious and vigilant approach in monitoring market developments.

In turn, the ongoing efforts by OPEC and its allies may keep the price of oil afloat as the most recent Monthly Oil Market Report (MOMR)insists that “in 2021, world oil demand is forecast to increase by 5.9 mb/d, reflecting the positive economic impact on oil demand during 2H21, but the recovery in US production may drag on crude prices as output increases for the second consecutive week.

Image of EIA Weekly US Field Production of Crude Oil

Recent figures from the Energy Information Administration (EIA) showed weekly field production widening to 11,100K from 11,000K in the week ending March 19, and a further rise in US crude output may drag on the price of oil ahead of the next OPEC JMMC meeting on April 28 with the group on track to gradually reverse the production cuts in response to COVID-19.

With that said, the decline from the yearly high ($67.98) may turn out to be change in market behavior rather than a near-term correction as the price of oil snaps the upward trend carried over from last year, and recent developments in the Relative Strength Index (RSI) highlight a similar dynamic as the oscillator tracks the downward trend established in March.

Oil Price Daily Chart

Image of Oil price daily chart

Source: Trading View

  • Keep in mind, crude broke out of the range bound price action from the third quarter of 2020 following the failed attempt to close below the Fibonacci overlap around $34.80 (61.8% expansion) to $35.90 (50% retracement), with the price of oil taking out the 2019 high ($66.60)as both the 50-Day SMA ($59.88) and 200-Day SMA($46.89) still reflect a positive slope.
  • However, the price of oil has slipped below the 50-Day SMA ($59.87) as it snapped the upward trend from November, with the Relative Strength Index (RSI) indicating a further correction in crude as it tracks the downward trend established in March.
  • The price of oil appears to be stuck in a narrow range following the failed attempt to trade back above the $61.80 (50% expansion) region, but need a move below the $58.00 (50% expansion) to $58.40 (23.6% expansion) to bring the Fibonacci overlap around $56.00 (23.6% expansion) to $56.70 (61.8% expansion) on the radar.
  • Next area of interest comes in around $52.30 (50% expansion) to $53.30 (38.2% expansion), which sits just above the February low ($51.64), followed by the $49.20 (50% expansion) area.
  • At the same time, a close above $61.80 (50% expansion) opens up the $62.80 (61.8% retracement) to $62.90 (78.6% expansion) area, with the next region of interest coming in around $64.20 (61.8% expansion).

--- Written by David Song, Currency Strategist

Follow me on Twitter at @DavidJSong

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

DISCLOSURES