Crude Attempting to Breakout
Crude Rally Pauses
Crude prices are a little softer today with momentum stalling for now on the back of yesterday’s push higher. The futures market hit its highest level since October earlier in the session before sell interest took hold. A sharp downturn in USD is helping drive commodities prices higher midweek. Rising geopolitical uncertainties have been a key theme of this Dollar decline and look set to keep USD skewed lower for now, allowing crude room to push higher.
US/Iran Fears
Growing fears over a potential US strike on Iran are seen in response to news that the US has move key military assets into the Middle East. While no fresh rhetoric has been heard from Trump, traders are fearful of such a move give the unpredictable nature of his policy decisions recently. If a strike was launched this would see oil prices sharply higher given the potential for big supply disruption.
Winter Storms in US
Huge winter storms in the US have also contributed to crude upside this week with around 2 million barrels per day of output lost over the last week. With extreme weather conditions continuing in places the impact looks set to remain for now with inventories likely to see sharp declines in coming weeks which should further support prices.
Technical Views
Crude
The rally in crude has seen the market breaking back above the 61.39 level. While the move has stalled for now into a test of early Jan highs, the outlook remains bullish while above the 61.39 level with 64.42 the next bull target.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.