Yes, oil prices are burning right now, and inflation is getting hotter along with it worldwide. However, the oil's bullish momentum is under threat.
USD Declines on Powell Remarks
2021-08-27 • Updated
After multiple hawkish remarks over the past few days from non-voters members, the Federal Reserve chairman Powell surprised the markets with some dovish remarks.
The Fed Chairman seemed to cast doubt on whether a taper at all this year was a good idea. In short, the Fed might either delay tapering and/or taper by small amount and stretch it over the next year.
In short, its clear that tapering the current QE won't be rushed, which is welcomed by the markets. The US equities at session high so far, while the US Dollar declined further back below 93.00. Such decision might lead to a deeper retracement to the downside towards 92.50, and maybe 92.30's later next week. Yet, this doesn’t mean that the uptrend has changed. Such decline will be another short-term play.
Oil markets were under great pressure amid increased demand and falling supply. OPEC+ is unable or unwilling to achieve its self-imposed production targets and insists on limiting production increases by 400,000 barrels per day despite rising prices.
Bloomberg reported that ‘the S&P 500 Energy Index has outperformed the broader S&P 500 by 21 percentage points so far this year'.
The stock market has reversed, and now it’s going lower and lower…
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