- WTI holds onto Friday’s recovery moves, firmer after four-week uptrend.
- UN refrains from direct meddling into Gaza, China blames the US for that.
- US data cools down inflation concerns, weighs on DXY.
- China data, risk headlines become the key as bulls battle key hurdle.
WTI wavers around $65.50, easing of late, during Monday’s Asian session. In doing so, the energy benchmark struggles to justify the market’s optimism towards further easy money policy from the Fed as well as geopolitical tension in the Middle East. The reason could be traced from the cautious sentiment ahead of China data.
Friday’s downbeat US Retail Sales and Michigan Consumer Sentiment Index, not to forget the Industrial Production, gave another chance to the US Federal Reserve (Fed) policymakers in defending the easy money policy. The Fed aptly took the advantage of recently mixed data to shrug off the push towards policy adjustments.
As a result, the global markets turned positive and weighed on the US dollar index (DXY) as well as the US Treasury yields. The same favored commodity prices and boosted WTI to post the heaviest daily gain in a week.
While oil traders keep searching for fresh clues, no fresh challenges to the Fed’s easy money policies favor risk-on mood.
Also on the positive side was the news suggesting that the United Nations (UN) refrains from any direct meddling in Gaza, due to the US as per China. The Israel-Palestine tussles are turning scary of late, which in turn suggests the oil supply hurdles and back the energy bulls.
It should, however, be noted that China’s Industrial Production and Retail Sales for April, expected 9.8% and 24.9% YoY respectively versus 14.1% and 34.2% in that order, will be the key for oil prices amid fears of the downbeat outcome. Meanwhile, upbeat figures could keep the market optimism intact and offer extra support to the oil buyers.
Technical analysis
A daily closing beyond the $66.15-25 area, comprising multiple tops marked since early March, becomes necessary for the WTI bulls before targeting the yearly high of $67.86.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.