Analys från DailyFX

Crude Oil Price Forecast: Seven-Week Lows on USD Strength & Supply

Published

9 år ago

11 november, 2016

DailyFX

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Talking Points:

Crude Oil Technical Strategy: Slipping Below 200-DMA at $43.80 Ichimoku Cloud
Commodity Sector Feels Pain of USD Strength On Broad Energy Metals Slump
Baker Hughes Rig Count Rises by 2 to 452 As OPEC Output Also Gains

The price of Oil broke the post-election lows on Friday and moved further below the 200-DMA. The price pivots and eventual trends that have developed off the 200-DMA make the next few days of trading increasingly important as a further breakdown could favor the view we shared that the move higher in October was a double-top that may revert to the long-term channel mean of ~$35/bbl.

Interested In a Quick Guide about OPEC, Click Here

As the price of Brent Crude Oil settled below the 200-DMA on Friday (settlement is determined by average price over last hour of trade), traders continue to look at the increasing number of variables to consider. The seven-week low in price came on further USD strength and news of increased output by OPEC members. The formal negotiations for the deal have been rumored to be moved up to Nov. 28, but the outcome that results in an across the board production cut continues to be in doubt. All of these variables around founded on Wednesday’s data from the EIA showing the largest gain in U.S. crude output week-on-week since May 2015, which was followed by the IEA releasing another warning of pressure on the price of Oil due to, “relentless supply growth.”

D1Crude Oil Price Chart: Breakdown Below 200-DMA Turns Focus To Double-Top

Chart Created by Tyler Yell, CMT Courtesy of TradingView

The chart above displays the multi-week ~17% price drop in Crude as doubts grow about whether or not OPEC would reach an agreement to cut production on November 28. The move lower has extended past the base of the Ichimoku Cloud and the 200-DMA ($43.80/bbl). The bearish view now becomes increasingly comfortable and could soon become the default view if the price remains below both of these indicators.

One discussion we’ve held off with the price above the 200-DMA and the Cloud was the possibility of a double top at $51/bbl. Given the three-wave move higher toward the $51.91 level in October, we will anticipate an impulsive decline, which could take us aggressively lower toward the August low of $39/bbl and possibly much lower. Given the weekly close below the 200-DMA, we may see hedge fund positioning shifting toward a Bearish posture, which would put the wind at the back of the Bears.

One component that had not shown up as the price of Oil traded toward the 200-DMA is a strong US Dollar. After the election of Donald Trump, we have had a very strong move higher in the DXY, and we should be on the watch for continued Dollar strength that tends to align with Oil weakness like we saw in H2 2014.

While the recent bearish move in Oil has been on reliant on the breakdown in OPEC negotiations, a resumption of USD strength that we saw in late October could keep price pressured near the 200-DMA until more clarity is gained.

Key Levels Over the Next 48-hrs of Trading as of Friday, November 11, 2016

T.Y.

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Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

Published

8 år ago

30 september, 2017

DailyFX

What’s inside:

EURUSD broke the ‘neckline’ of a bearish ‘head-and-shoulders’ pattern, April trend-line
Resistance in vicinity of 11825/80 likely to keep a lid on further strength
Targeting the low to mid-11600s with more selling

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Coming into last week we pointed out the likelihood of finally seeing a resolution of the range EURUSD had been stuck in for the past few weeks, and one of the outcomes we made note of as a possibility was for the triggering of a ’head-and-shoulders’ pattern. Indeed, we saw a break of the ’neckline’ along with a drop below the April trend-line. This led to decent selling before a minor bounce took shape during the latter part of last week.

Looking ahead to next week the euro is set up for further losses as the path of least resistance has turned lower. Looking to a capper on any further strength there is resistance in the 11825-11880 area (old support becomes new resistance). As long as the euro stays below this area a downward bias will remain firmly intact.

Looking lower towards support eyes will be on the August low at 11662 and the 2016 high of 11616, of which the latter just happens to align almost precisely with the measured move target of the ‘head-and-shoulders’ pattern (determined by subtracting the height of the pattern from the neckline).

Bottom line: Shorts look set to have the upperhand as a fresh month gets underway as long as the euro remains capped by resistance. On weakness, we’ll be watching how the euro responds to a drop into support levels.

For a longer-term outlook on EURUSD, check out the just released Q4 Forecast.

EURUSD: Daily

—Written by Paul Robinson, Market Analyst

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You can follow Paul on Twitter at@PaulRobinonFX.

Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

Published

8 år ago

29 september, 2017

DailyFX

Euro Bias Mixed Heading into October, Q4'17

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

EURUSD: Retail trader data shows 37.3% of traders are net-long with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07831; price has moved 9.6% higher since then. The number of traders net-long is 15.4% lower than yesterday and 16.4% higher from last week, while the number of traders net-short is 0.4% higher than yesterday and 10.5% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

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Analys från DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Published

8 år ago

29 september, 2017

DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

GBPUSD: Retail trader data shows 38.2% of traders are net-long with the ratio of traders short to long at 1.62 to 1. In fact, traders have remained net-short since Sep 05 when GBPUSD traded near 1.29615; price has moved 3.4% higher since then. The number of traders net-long is 0.1% higher than yesterday and 13.4% higher from last week, while the number of traders net-short is 10.6% lower than yesterday and 18.3% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form