WTI recedes from fresh 2019 tops beyond the $56.00 mark

Prices of WTI exceed the $56.00 mark and clinch YTD peaks.
WTI advances for the second session in a row.
Oil rig count rose by 3 during last week to 857 active oil rigs.

Pablo Piovano FXStreet

Prices of the barrel of the American reference for the sweet light crude oil are hovering the $56.00 mark today, a tad lower than earlier 2019 tops near $56.30.

WTI up on USD-selling, trade hopes

The rally in crude oil remains well and sound on Monday, moving further north of the $56.00 mark per barrel, or fresh yearly highs.

In fact, prices of the WTI are extending the upside momentum since monthly lows in the vicinity of the $51.00 mark seen on February 11, always on the back of rising expectations of a positive outcome from the US-China trade talks, which are expected to resume this week in Washington.

Furthermore, the ongoing turmoil around Venezuelan output (or rather absence of it) plus comments from Saudi officials stressing the country could curb its output further is also sustaining the up move in prices.

Additional news around crude oil noted the OPEC cut its forecasts for the demand of its crude oil following prospects of slowing economy, while the EIA now sees US oil production ticking higher to 13.2 mbpd in 2020 (from 12.9 mbpd in the previous report).

What to look for around WTI

Hopes of a US-China trade deal have lent extra oxygen to crude oil prices in past sessions and this should remain a key driver in the very near term ahead of this week’s negotiations. On the broader picture, the ongoing OPEC+ agreement to curb oil production, US sanctions against Venezuelan and Iranian oil exports and the so-called ‘Saudi Put’ should keep a firm floor under crude prices.

WTI significant levels

At the moment the barrel of WTI is up 0.70% at $56.13 facing the next hurdle at $56.24 (2019 high Feb.18) ahead of $57.05 (100-day SMA) and then $58.00 (high Nov.16 2018). On the downside, a breakdown of $53.82 (10-day SMA) would aim for $51.15 (low Feb.11) and finally $51.11 (55-day SMA).

Author

Pablo Piovano

FXStreet

Born and bred in Argentina, Pablo has been carrying on with his passion for FX markets and trading since his first college years.

AUD/USD bounces off nearly two-month low; upside seems limited

AUD/USD rebounds from its lowest level since April 13, touched during the Asian session on Monday, as the US Dollar pauses following Friday's upbeat US NFP-led blowout rally to a two-month high. However, persistent geopolitical uncertainties, along with surging bets on Fed rate hikes, might continue to act as a tailwind for the USD. Furthermore, diminishing odds of a near-term RBA rate hike should cap gains for the Aussie.

USD/JPY bulls seem hesitant amid intervention fears

USD/JPY touches a fresh high since late April following an Asian session dip, though intervention fears limit losses for the Japanese Yen (JPY) and cap the upside. This counters Japan’s revised GDP print, which confirmed that the economy lost momentum in the first quarter. Meanwhile, Friday's upbeat US NFP report lifted bets of a Fed rate hike and favors the US Dollar bulls, backing the case for a further move higher for the currency pair.

Gold recovers slightly from the $4,300 neighborhood; not out of the woods yet

Gold attracts some buyers at the start of a new week and reverses part of Friday's decline to its lowest since March 24, around the $4,300 mark. The US Dollar pauses after Friday’s upbeat US NFP-led blowout rally to a two-month high and supports the bullion. However, a surge in bets on a Fed rate hike, along with geopolitical uncertainties, favors USD bulls. The backs the case for the emergence of fresh sellers around the precious metal at higher levels.

Week ahead: Fed countdown begins amid US inflation data and geopolitical risks

The countdown to the biggest event of the year so far, the first Fed meeting under Chair Warsh on June 17, has officially commenced. Next week’s key events could serve as the best appetizer for Warsh’s first press conference, although market participants will probably be distracted by developments elsewhere.

Week ahead – Fed countdown begins amid US inflation data and geopolitical risks

Fed Chair Warsh’s first meeting approaches as key US inflation data could reshape expectations. Oil prices remain elevated as US-Iran talks continue; tariffs also return to the spotlight. ECB is expected to hike; will it be a one-off move or is July live?

The US economy defies the rules: 100 days into the Oil shock and the recession signal is still missing

More than three months after the start of the Iran war and the resulting disruption to global energy markets, the US economy continues to display remarkable resilience. The conflict has triggered a sharp rise in Oil prices, reignited inflationary pressures and fueled widespread concerns about a potential economic slowdown.