Crude Oil Extends Rally, GBPUSD Undeperforms , USD Eyes Fed Speak - US Market Open
MARKET DEVELOPMENT – Crude Oil Extends Rally, GBP Underperforms
Crude Oil: Brent crude futures continues to edge higher as Saudi jawboning continues to take precedent over rising US oil supply. As a reminder, the DoE report showed US production hitting a fresh record high at 12mln, however, given that rising production has been flagged for some time, this has failed to dent the upside in crude futures. On the topside, near-term resistance resides at 68.45 (50% Fibonacci Retracement), in which a break may see the rally extend to $70.
GBP: The Pound has extended on its pullback against the greenback following a break below the 1.30 handle and 200DMA, consequently hovering at sessions lows of 1.2970. Uncertainty over Brexit continues with a UK official noting that it is very unlikely that a Brexit deal will be voted on next week. As such, the Pound has unwound much of the gains seen earlier in the week. Headline risk remains abundant for GBP.
USD: A mixed session for the greenback thus far with little in the way of notable drivers this morning. As FX implied vols drop, major G10 pairs have largely been somewhat rangebound. Consequently, with little on the economic data front, focus will turn towards the plethora of Fed speak.
AUD: After a somewhat excessive move to the downside yesterday with apparent tensions on the rise between China and Australia regarding coal import bans, the Australian Dollar has recovered slightly to remain within close proximity to the 0.71 handle.
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--- Written by Justin McQueen, Market Analyst
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