The oil markets sustained losses yesterday afternoon following the
International Energy Agency (IEA) warning that global inventories are
set to continue to rise before any possible cut in production. This
provided a gentle reminder to traders that the supply and demand
equation is still very much present, with the aggressive supply surplus
going to remain for some time. While the recent bounce back has provided
evidence that traders remain interested in purchasing the commodity and
likely ready to pounce on any indications of slowing production, less
production needs to be seen. This will provide the bulls with a
stumbling block, while also limiting how high the price of oil can jump
in the meantime.
Unless production is definitively cut to lower levels, there will always be a risk of a pullback in the price – like we saw yesterday afternoon. In regards to what will likely next dictate the price action in WTI and Brent Crude, it might be worth paying attention to this afternoon’s US Crude Inventories report. Oil bulls will be hoping for production levels to miss forecasts and provide optimism of slowing oil production but if inventories continue to rise beyond expectations, the commodity will be at risk to extending yesterday’s losses.
The GBPUSD was an interesting pair to watch yesterday, with the Cable at times seen alternating between bullish and bearish momentum, before concluding trading up on the day at 1.5252. Monthly industrial production did miss forecasts slightly, but this has been partly attributed to maintenance work in some oil and gas fields. The manufacturing production figures provided another surprise to the upside, following a trend set last week when a hat trick of PMIs were revealed above expectations and provided optimism that the UK economy has begun the year on the right track.
Read more at Click here / www.trade4x.net
Unless production is definitively cut to lower levels, there will always be a risk of a pullback in the price – like we saw yesterday afternoon. In regards to what will likely next dictate the price action in WTI and Brent Crude, it might be worth paying attention to this afternoon’s US Crude Inventories report. Oil bulls will be hoping for production levels to miss forecasts and provide optimism of slowing oil production but if inventories continue to rise beyond expectations, the commodity will be at risk to extending yesterday’s losses.
The GBPUSD was an interesting pair to watch yesterday, with the Cable at times seen alternating between bullish and bearish momentum, before concluding trading up on the day at 1.5252. Monthly industrial production did miss forecasts slightly, but this has been partly attributed to maintenance work in some oil and gas fields. The manufacturing production figures provided another surprise to the upside, following a trend set last week when a hat trick of PMIs were revealed above expectations and provided optimism that the UK economy has begun the year on the right track.
Read more at Click here / www.trade4x.net
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