WTI hits nine-day low

The huge increase in crude oil inventories as at May 17 reported last night by the Energy Information Administration (EIA) was enough to send crude oil prices crashing. The 4.74 million barrels added to stockpiles was well above the near 600,000 analysts had expected and could imply a slackening in demand amid the ongoing uncertainty surrounding the US-China trade negotiations.

WTI fell 2.6% yesterday, closing below the 55-day moving average for the first time since January 17, and has added another 0.5% to those losses today. Crude is now trading at $60.85 with support at the 200-day moving average at $60.22 near, which has held on a closing basis since April 1.


WTI Daily Chart

Source: OANDA fxTrade


Persistent easing

Bank of Japan Deputy Governor Amamiya trotted out the usual BOJ mantra this morning, saying there is a need to continue easing persistently as it will take time for the Bank to hit its 2% inflation target. He added that the Bank would need to consider the market impact, both at home and abroad, when adjusting rates and would communicate an easing exit appropriately at the time.

USD/JPY showed little reaction to the statement, trading in a tight 110.12-110.35 range during the Asian morning. The FX pair is trading in the red for a second straight day after enjoying a four-day run up to the 100-day moving average at 110.53.


Pound still pressured

Brexit headlines have dogged the pound this week as it faces its 14th down day in the past 15 sessions. This has seen GBP/USD tumble 4.2% from the 1.3175 high struck earlier this month. That would be the worst monthly performance since May last year.

GBP/USD Daily Chart

Source: OANDA fxTrade


The next event to monitor will likely be PM May’s meeting with the 1922 Committee, a Conservative Party group made up of all backbench MPs, where widespread rumours suggest she may be asked to step down from her leadership role on June 10. It could come earlier if the Committee is able to change party leadership rules to allow them to force her out immediately. It could get exciting for the pound as we head toward the weekend.


German GDP seen unchanged

The first revision to Germany’s Q1 GDP data is not expected to result in any changes, both on a quarterly and annual basis. Surveys suggest growth of 0.4% q/q and 0.6% y/y will remain. We get to see the first of the May indicators with the release of Markit’s manufacturing PMI for Germany, the Euro-zone and the US. The European ones are expected to show a slight improvement with a small deterioration for the US reading.

We also get to see new home sales for April and finish off with a slew of Fed speakers: Kaplan, Daly, Bostic and Barkin are all scheduled to speak at 1700GMT.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities.

Opinions are the authors — not necessarily OANDA’s, its officers or directors. OANDA’s Terms of Use and Privacy Policy apply. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Feed news

Latest Forex Analysis

Editors’ Picks

EUR/USD consolidates losses as Fed moderates message

EUR/USD is trading above 1.1350, consolidating losses. The Fed's Bullard and Chair Powell have conveyed a balanced message, boosting the greenback. Treasury Secretary Mnuchin said 90% of the deal with China is done.


GBP/USD trades below 1.2700

GBP/USD is trading below 1.2700. BOE Gov. Carney said the BOE may cut rates in case of a no-deal Brexit. Boris Johnson has rattled markets by saying leaving the EU by October 31st is "do or die."


USD/JPY sticks to gains near 107.70, looks to snap 7-day losing streak

Following the sharp upsurge witnessed during the European trading hours, the USD/JPY pair has gone into a consolidation phase and is now moving in a relatively tight range in the upper half of its daily trading range.


EIA: Crude inventories decreased by 12.8 million barrels, WTI inches closer to $60

In its weekly petroleum report for the week ending June 21, the Energy Information Administration (EIA) announced that the commercial crude oil inventories in the United States decreased by 12.8 million barrels from the previous week. 

Read more

Gold finds some support near $1400 mark, lacks follow-through

Gold held on to its weaker tone through the early North-American session, albeit pared a part of its intraday slide to the $1400 neighbourhood post-US economic data.

Gold News