Analys från DailyFX

Crude Oil Price Forecast: 16-Month Highs In Oil Negates Double-Top

Published

9 år ago

5 december, 2016

DailyFX

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Talking Points:

Crude Oil Technical Strategy: Strong Dollar Clear Support In Focus To Resume Downtrend
OPEC Production Cut Deal Comes Down To the Wire, Crude Down ~3.5% On Session
Deal Rejection Could Lead To Long Winter For Oil Market

In a rather surprising move, OPEC went ahead with the Oil Production cut that they agreed to in Algiers in October. The cut has taken Oil to the highest levels since June 2015. The surprise mainly came from the apparent tension leading up to the agreement, but now that the Accord has been put in place, which will take effect on January 1st, the good news continues to flow. The specific good news in focus at the beginning of December is the potential for Non-OPEC players like Russia to join the production cut.

Interested In a Quick Guide about OPEC, Click Here

Looking at the technical picture with Oil’s recent strength, we have seen a turn lower in the US Dollar that could continue to be a key factor in Oil’s strength.

D1Crude Oil Price Chart: USOIL Advanced Above the Potential Double-Top To July 2015 Levels

Chart Created by Tyler Yell, CMT Courtesy of TradingView

The support that we had been focusing on throughout the 2016 rebound was the rising trendline (black on the chart above) drawn from the first higher low. We were looking for a break below this on a possibly failed OPEC deal to be a confirmation that a double-top was in play. We now see the opposite was in the works where the trendline holding preceded new 16-month highs.

We noted from recent Commitment of Traders data was that we saw that long Brent exposure increased by its most in 7-weeks last week by Hedge Funds before the cut was announced. However, per Bloomberg and CFTC data, Hedge Fund managers cut their long-exposure by ~5% ahead of the cut, which may mean that a lot of the post-cut rally were those managers that missed the initial surge jumping back in.

A breakout in price may also be achieved if we see the RSI (5) on the lower portion of the chart above breakout above the trendline drawn since the summer momentum peak.

Another component that could help the price of Oil stay in breakout mode is the pull-back in the Dollar Index that we’ve seen in early month flows after the Italian Referendum.

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While the 18-week technical picture is messy, further upside targets are aided by Fibonacci analysis over recent price ranges. When looking at the May 2015-February 2016 range as well as Fibonacci Expansions over the recent October-November range, we see a confluence of upside targets near $54/bbl in WTI (CFD: USOil).

Another sign that we’ve been on the watch out for is the definitive pull-away from the top of the Andrew’s Pitchfork. As price continues to pull away from the Pitchfork and trade above the Ichimoku Cloud, the burden of proof will fall on the bears to prove their case as the Bulls look to be trading in the path of least resistance.

Key Levels Over the Next 48-hrs of Trading as of Monday, December 05, 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