It seems that investors have found an asset that disperse up in the hope of establishing a stable uptrend.
The extreme degree of uncertainty that the Fed continues to produce their intricate operations against raising rates is stored for over a year. This led to the fact that all segments of the global financial market was not a single trend movement. In general, all assets moved erratically, sideways. But here there is a real opportunity to disperse the oil prices, taking advantage of the low base effect, which was formed in the middle of the winter. This contributes to a decrease in US oil inventories, and until recently supported the idea of a freeze on oil agreements in Doha. But the summit was a failure, and the quotations of oil still soared again to the local maximums already speculation about strikes in Kuwait. Good support also has the weakness of the US dollar in the wake of the mass signals from the Fed about a pause in rate hikes.
In the wake of news and events market fully mastered short-term speculators, who chase the assets going up and down. It would seem that the failure of the Doha had to bring down oil prices below $ 40 per barrel, but this did not happen, as the participants there is still hope that oil reserves in the world will continue to decline, and this is a natural way lead to rebalance the market of black gold and the situation stabilizes.
The latest data on positioning in the oil market indicate that formed very large long position, which can lead to a dramatic reduction, if Saudi Arabia will increase production of black gold (she is already promised to do so), and the strike is over in Kuwait. And against the backdrop of pessimism in crude oil prices may leave a mark below 40 dollars per barrel and even lower. If this happens, the commodity currencies which courses just soared in the past two months, once again come under pressure and will fall.
Speaking about the situation in the markets as a whole, we can see that the factor of instability for a long time will it dominate, while the Fed will not resume raising rates and not put everything in its place.
Today, of the economic statistics, investors’ attention will be drawn to the publication of the index data ZEW economic sentiment in Germany and the euro zone. Positive values of the indicators will provide local support for the euro in tandem with the US dollar. Also will be released figures on the number of building permits in the United States and a number of other indicators with the construction market. In addition, made by the heads of the Central Bank of Canada and Britain.
The forecast of the day:
The EUR / USD can get limited support in the wake of positive data from Germany and the euro zone, which could result in the breakout level of 1.1350 to an increase in the price to 1.1430.
Pair USD / CAD fell to a local minimum on higher crude oil prices, but if this growth does not continue, and published Wednesday in the US oil inventory data will show their increase, we can expect a rollback pair up to 1.2970