Four reasons why WTI Crude Oil is rising – Global stock indices falling: Opportunities? [Video]

Brad Alexander FX Large Limited

In today’s Market Outlook, let’s take a look at Forex Trading on USDCAD, the FTSE100, the S&P500, the NASDAQ, and WTI Crude Oil.

Just a reminder that these videos are intended as educational, we are only observing current market conditions, and these are not to be considered as trading advice.

We see the price of WTI and Brent Crude Oil increasing steadily since the beginning of the year.

Why is this?

Firstly, we have had geopolitical tensions all year, mostly based on the US facing off against Iran.

Secondly, OPEC+ production levels have remained steady despite the third reason that supply is steadily decreasing.

The fourth reason is simply demand, as colder-than-normal weather has affected much of the northern hemisphere this year.

Again, we see prices rising as price action has just bounced off the lower trend line, and the stochastic oscillator is turning up from oversold.

Also, we could list several reasons for the decline in global stock indices, where a risk-off mood, with economic uncertainty, a weak US jobs market, and fear of over-priced tech and AI stocks are causing a sell-off.

Again, good news from any level, including the US Supreme Court, regarding the legality of tariffs, should help the market to have the confidence to buy the dip.

Speaking of buying the dip, the UK’s FTSE100 has fallen as well, but technically, we may be looking at a reversal as price action reaches this lower trend line.

We see most CAD pairs ranging, except for USDCAD, where we have some volatility.

Regardless, this afternoon we will look for an opportunity after the Canadian Employment data due out at 1:30 pm London time.

Last time we looked at setting up Moving Average Crosses on cTrader, and now we can look at a couple of practical examples used by analysts and financial news outlets.

Here we have a slow 200-period Simple Moving Average being crossed by a faster 50-period Simple Moving Average.

This is called a Golden Cross, and it gives the market confidence that the bull run will continue.

The opposite is called a Death Cross, where the 50 passes below the 200, but we are not there yet.

We do see, however, that price action on the NASDAQ is falling close to the 200-period Simple Moving Average.

If it falls below, we would be entering a bear market.

An example of a Death Cross can be seen here, and look what happened to price action after that.

Author

Brad Alexander

FX Large Limited

Brad became fascinated with the Currency Markets from a young age and researched fundamental analysis.

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