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.

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
EUR/USD
Bearish
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
Wall Street
Mixed
Gold
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
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • UK PM Spokesman says UK has had useful exchanges with EU In recent weeks $GBP
  • Entry orders are a valuable tool in forex trading. Traders can strategize to come up with a great trading plan, but if they can’t execute that plan effectively, all their hard work might as well be thrown out. Learn how to place entry orders here: https://t.co/lAFyv1gM0P https://t.co/zqCvKazckA
  • 🇲🇽 Economic Activity YoY (JUL) Actual: -9.8% Expected: -10% Previous: -13.3% https://www.dailyfx.com/economic-calendar#2020-09-25
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.79%, while traders in EUR/GBP are at opposite extremes with 65.81%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/pPMQB3Sgtf
  • Heads Up:🇲🇽 Economic Activity YoY (JUL) due at 11:00 GMT (15min) Expected: -10% Previous: -13.2% https://www.dailyfx.com/economic-calendar#2020-09-25
  • Norges Bank - total liquidity has been unevenly distributed between banks, leading to considerable uncertainty over supply of NOK. Adds that they will offer fully allotted F-Loans at fixed rates with 1 day maturities
  • London put on national Covid watch list amid recent surge in cases
  • Commodities Update: As of 10:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: -0.29% Gold: -0.42% Silver: -1.13% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/OTTxCl6GJR
  • Spanish health minister says the government recommends a total lockdown in Madrid
  • Forex Update: As of 10:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.18% 🇦🇺AUD: 0.02% 🇯🇵JPY: -0.05% 🇨🇭CHF: -0.11% 🇪🇺EUR: -0.22% 🇬🇧GBP: -0.25% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/37yFAZ530P
Limited Further Upside Potential for Brent Crude Oil Price

Limited Further Upside Potential for Brent Crude Oil Price

2017-11-01 12:10:00
Martin Essex, MSTA, Analyst
Share:

Talking Points

- The price of Brent crude oil has topped $60 per barrel for the first time since July 2015 and could yet climb further.

- However, its advance is likely to pause soon and it could well give up some of its gains.

What Does the Fourth Quarter Hold for Oil, the Dollar, Equities and Other Key Markets? Find out here

The price of Brent crude oil, the global benchmark, has jumped above $60 per barrel as the advance that began in June continues. However, the climb that has taken it to its highest level for more than two years in likely to run out of steam before too long.

From a fundamental perspective, the price has benefited in recent days from expectations that OPEC-led production cuts will be extended beyond March, possibly until the end of next year, although such a move is likely to spur more US production.The Organization of the Petroleum Exporting Countries plus Russia and nine other producers agreed to cut 1.8 million barrels per day from January 2016 to clear a supply glut, and both Saudi Arabia and Russia have pressed for the further extension as an OPEC meeting on November 30 approaches.

In addition to signs that producers have improved their compliance with current quotas, data from the American Petroleum Institute have shown a bigger-than-expected decline in US crude and gasoline inventories last week. More weekly data due this session from the US Energy Information Administration are expected to show a drop of 1.756 million barrels in crude stocks, compared with the previous rise of 0.856 million.

That has lifted the price of Brent crude but a retracement seems likely now both the September high at $58.92 and the “round-number” resistance at $60 have been taken out. One possible stumbling block could be the highs close to $63 reached in February 2015, especially as the 200-week moving average comes in around the same level.

Additionally, as the 14-day relative strength indicator at the bottom of the chart below shows, the RSI is now above 70 so in overbought territory.

Chart: Brent Crude Oil Daily Timeframe (June 10 – November 1, 2017)

Limited Further Upside Potential for Brent Crude Oil Price

Chart by IG

Note too that the Brent/WTI spread – the difference in price between the global benchmark and the US benchmark – is currently at $6.37 after reaching around $7, its highest for more than two years.

--- Written by Martin Essex, Analyst and Editor

To contact Martin, email him at martin.essex@ig.com

Follow Martin on Twitter @MartinSEssex

For help to trade profitably, check out the IG Client Sentiment data

And you can learn more by listening to our regular trading webinars; here’s a list of what’s coming up

Check out our Trading Guides: Several new ones are now available including Forex for Beginners, Building Confidence and Traits of Successful Traders

Like to know about the Traits of Successful Traders? Just click here

Or New to Forex? That guide is here

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

DISCLOSURES