Last Friday we saw a rout everywhere in markets but crude Oil managed to hold up. That’s despite the risks of an Iran deal announcement on the weekend
Last Friday we saw a rout everywhere in markets but crude Oil managed to hold up. That’s despite the risks of an Iran deal announcement on the weekend. Oil prices have been mostly mixed today, as investors try to balance expectations that OPEC will cut output to support prices, against concerns sparked by Federal Reserve Chairman Jerome Powell saying the United States will face slow growth “for some time”.
In a speech on Friday, Powell said that curbing inflation “is likely to require a sustained period of below-trend growth” and would “bring some pain to households and businesses”, which sent equity markets tumbling, while boosting the dollar.
Crude Oil Daily Chart – The 200 SMA Acting As Resistance
The downtrend continues on the H4 chart
The USD index continued to climb higher today, reaching 109.16 [points. A stronger dollar weighs on Oil as it makes crude more costly for buyers holding other currencies. However, Oil prices have been buoyed by comments from Saudi Arabia and other members of the OPEC (Organization of the Petroleum Exporting Countries) and allies, together called OPEC+, that they could cut output in order to balance the market.
But, the overall trend still remains bearish, with Oil making lower highs for more than two months. Last week WTI crude peaked above the 200 SMA (purple) on the H4 chart, but the price returned below pretty soon. Today buyers are testing that moving average again, which is acting as support this time, so we decided to open a sell Oil signal a while ago.
WTI
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