Last week marked the consolidation for the most active assets of March 1-15 (which is oil and gold). But next week has a lot to show, be ready to take part!
OIL: down to March levels
2020-11-02 • Updated
We have seen WTI oil price drop to $35 right before the weekend breaking through local support levels. Today, it almost touched $34 bouncing back up to $34.5.
On the daily chart, these levels correspond to June lows and the pre-final-fall zone of March. Which factors are affecting the oil market now?
The oil market trembles on any “hard” news or period, be it good or bad – that’s just because it is more unstable than usual since the virus pushed it out of balance.
The current hit of the virus is seen as more significant than many estimated it to be. That’s presses on the expectations of the oil demand recovery.
Joe Biden is leading in the polls so far. Investors are factoring in this bigger probability into the oil prices now. His plan is to get Iran back to the nuclear accord. It comes with Iran’s 2mln barrels of oil added into the market daily. That will press on the price in the mid-term and will be a problem for OPEC.
On the other hand, Joe Biden plans to “transition” the energy sector from oil to renewable resources – that, in theory, may reduce US oil production, especially shale, and lift the prices in the long term to the joy of OPEC as well.
The oil price now reacts to a set of factors, and you cannot really know which factor comes to the front line at which moment, especially now (before/on the day of the election). After – at least, it will be clear, who the US president is, and one of the factors of uncertainty will be out. So be careful trading it – there may be more movement this week.
Why brothers? If you put an oil chart on the S&P500 chart, you will find out that these assets have a strong correlation…
Besides US Retail Sales data, Australian Unemployment Rate and New Zealand GDP this week will bring us Quadruple Witching – one of the four most important days of a year for futures and options!
In the middle of September 2022, the Canadian dollar has fallen to a 2-year low against the USD
The US dollar index has all chances of reaching the 2000s high of 120.00.
The Consumer Price Index announcement by Statistics Canada is set for release in a few hours will reveal the state of inflation in the Canadian economy