Crude oil price wavers as US rig count starts to rise

The price of crude oil is little changed as traders react to the rising oil rig count data from the United States. Numbers released by Baker Hughes showed that total rig count rose by four to 183, which is the highest they have been since August. A rising number of rigs is usually an early sign of increasing supply. The data comes as concerns about demand rises. A few weeks ago, data from leading institutions like the International Energy Agency (IEA), OPEC, and the Energy Information Administration warned that demand was likely to slow as the number of coronavirus cases rise.

The Australian dollar is up in early trading as the market reacts to relatively strong economic numbers from China. Data released yesterday showed that industrial firms did well in August. Industrial profits declined by just 4.4% a month after they fell by 8.1%. That was the best-performing month since February, when profits fell by 3.1%. The profits increased by 19.10% on an annualised basis. The Australian dollar is often used as a proxy for China because of the close trading relationship between the two countries.

The British pound is rising today although traders remained concerned about the rising number of coronavirus cases in the country. On Sunday, health officials confirmed more than 5,600 new cases, which was slightly lower than the 6,200 reported on Saturday. Still, these numbers are significantly higher than those released in the previous weeks. The pound is also rising even as traders remain worried about the strength of the UK economy after data showed that the services sector had continued to weaken. 

EUR/USD

The EUR/USD pair is up slightly and trading at 1.1633, which is higher than Friday’s low of 1.1620. On the four-hour chart, the price has moved slightly above the lower band of the Bollinger bands. Also, the price is below the important resistance level at 1.1750, which was the neckline of the head and shoulders pattern. Therefore, with no major economic data expected today, the pair is likely to continue in this range today.

GBP/USD

The GBP/USD pair is up slightly to the current level of 1.1766. This price is slightly above Friday’s low of 1.2685. On the four-hour chart, the price is between the green bearish flag pattern. It is also along the 50-day and 25-day exponential moving averages and above the 23.6% Fibonacci retracement level. Therefore, the pair is likely to continue rising as bulls look to test the upper side of the flag pattern at ~1.2800.

AUD/USD

The AUD/USD is trading at 0.7053, which is higher than last week’s low of 0.7000. On the four-hour chart, the price is significantly below the 50-day and 25-day exponential moving averages. The pair is also forming a bearish flag pattern that is shown in white. This is a sign that there is indecision between bulls and bears about the future trend of the pair. Therefore, since a flag is usually a continuation pattern, there is a possibility that the price will continue falling.