Crude oil price rises as the Texas freeze continues

OctaFx Analyst Team OctaFX

The price of crude oil rose at the start of the week as the number of oil rigs stayed the same for the first time in 12 weeks. According to Baker Hughes, the total number of oil and gas rigs remained unchanged at 397 last week. The number of oil rigs dropped by 1 while the number of gas rigs rose by 1. Also, the EIA estimated that oil produced by the United States declined by 200k barrels to 10.8 million barrels. This trend was mostly because of the ongoing freeze in Texas. The freeze has led many companies to slash the number of working hours for some employees.

The US dollar rose slightly today as traders reacted to strong flash manufacturing and service PMI numbers from the United States. According to Markit, the services PMI increased from 58.3 in January to 58.9 in February. This is a sign that the US economy has started to recover. The manufacturing PMI fell from 59.2 to 58.5. Further data showed that the US existing home sales rose by 0.6% from 6.65m to 6.69m. The currency is also rising ahead of a stimulus vote in Congress that will happen this week.

The economic calendar will be relatively muted today. The most notable figures will be from Germany, where the IFO Institute will publish the current assessment and business expectations numbers. In China, the People's Bank of China (PBOC) will deliver its interest rate decision while in Turkey, the statistics office will release capacity utilisation and manufacturing confidence data.

EUR/USD

The EUR/USD pair dropped from Friday’s close of 1.2135 to the current level of 1.2115. On the hourly chart, the price has moved below the 23.6% Fibonacci retracement level while the price has moved below the 25-day moving average. The pair has also formed a double top pattern. Therefore, it will likely continue dropping as traders target the next support at 1.2100.

XBR/USD

The XBR/USD pair rose to an intraday high of 62.94. On the daily chart, this price is slightly below Friday’s high of 63.15. It is also on the same level as the right side of the head and shoulders pattern. The pair is also between the upper and middle lines of the Bollinger Bands. Therefore, the pair may resume a downward trend in the near term.

GBP/USD

The GBP/USD dropped sharply today as focus remained on the strong US dollar. The pair fell from a high of 1.4052 to 1.4015. On the four-hour chart, the price is still between the ascending white channel. It is also wavering near the highest level in three years and is above the 25-day and 15-day exponential moving averages. Therefore, the pair may resume the upward trend later today.

Author

OctaFx Analyst Team

OctaFX

OctaFX is a market-leading forex broker, providing personalised forex brokerage services to customers in over 100 countries worldwide.

AUD/USD defends 0.7000 ahead of RBA on Tuesday

AUD/USD is defending 0.7000 at the start of a new week, trading near its lowest level since August 4 amid a bullish US Dollar. US yields hold near multi-year highs amid inflation risks from higher oil prices and rising bets on an October Fed rate hike. This, along with the US-Iran standoff, continues to underpin the safe-haven buck and weigh on the pair ahead of Tuesday's RBA policy announcements.

USD/JPY climbs back toward 158.00 after BoJ minutes amid firm USD

USD/JPY finds dip-buyers and reverses part of Friday's slide driven by speculation that authorities will step in again to prop up the Japanese Yen. However, the BoJ's dovish Minutes cap the JPY. Meanwhile, the US Dollar regains traction as the US-Iran standoff supports crude oil prices, fueling inflation fears and reaffirming bets for an October Fed rate hike. This further supports the pair, driving it back toward 158.00.

Gold cracks $4,200 for the first time in eight weeks

Gold falls hard at the start of a new week, breaching $4,200 for the first time in eight weeks. Firming October Fed rate-hike bets, along with oil-driven inflation risks, keep US bond yields elevated near multi-year highs, helping the US Dollar regain positive traction amid persistent Iran risks. These factors weigh heavily on the bullion.

Bitcoin takes a breather, Ethereum faces pullback, XRP consolidates

Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) take a breather at the start of the week on Monday after their recent gains last week. BTC pulls back, trading below $83,600 while ETH extends its losses, trading below $2,700, and XRP consolidates around $1.500. The price action of these top three cryptocurrencies suggests a mild pullback or consolidation as traders assess their next direction.

After the Trump Xi summit, markets are trading three clocks

The summit delivered time, not a deal. Trade, oil and chips now each run to a date, and the macro backdrop matters more than the pageantry. Markets wanted a deal and got a calendar date instead. Xi Jinping left Washington on Friday after tea at the White House and a tour of the National Archives.

Fed vs BoJ: Both hiked. The market only believes one of them – and the chart shows which

The Fed and the BoJ have just done something remarkably similar. Both central banks raised interest rates by 25 bps last week, both are confronting inflation risks, and both signal that future decisions will depend on incoming economic data.