Oil: Short-term longs vs long-term shorts [Video]

Ipek Ozkardeskaya Swissquote Bank Ltd

The geopolitical situation in the Middle East gets tenser, and the Federal Reserve (Fed) doves get worried with the sight of better-than-expected jolts and ADP report announced earlier in the week. The US yields and the dollar extended recovery, stocks stagnated.

The broadly stronger US dollar, combined with a slide in the euro area inflation below the European Central Bank’s (ECB) 2% inflation target justifies a further selloff in the EURUSD, while the USDJPY sharply reversed course after the new Japanese PM said that the Japanese economy is ‘not ready yet for further rate hikes’.

In energy, crude oil failed to clear a major Fibonacci resistance as EIA data showed 3.9-mio barrel build in US inventories last week. Some voices are favouring a rise to $100pb level, but the macroeconomic challenges give little support to such a rally in oil prices – even with the messy geopolitical setup in the Middle East.

Author

Ipek Ozkardeskaya

Swissquote Bank Ltd

Ipek Ozkardeskaya began her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked in HSBC Private Bank in Geneva in relation to high and ultra-high-net-worth clients.

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