Get started

Opec

XAUUSD is ready to reach $2500 before the crash!Current Overview Gold (XAU/USD) has regained traction, trading in positive territory slightly above $2,420 after dipping towards $2,400 at the beginning of the week. Technical Analysis Daily Chart: The bullish outlook for XAU/USD remains strong despite a retreat from intraday highs. The daily chart shows that the pair is rallying well above bullish moving averages. Technical indicators are gaining upward momentum and approaching overbought readings, with no signs of reversal. 4-Hour Chart: In the near term, XAU/USD might face challenges in extending its gains. Technical indicators are retreating from overbought readings with uneven strength but remain above the bullish 20-period Simple Moving Average (SMA) around $2,400. Key Levels Resistance Levels: Immediate resistance is at the recent high of $2,439. If XAU/USD surpasses this level, it could test the year-to-date high of $2,450. Further gains could target the $2,500 level. Support Levels: Initial support is at $2,400. Market Sentiment US Dollar Dynamics: Demand for the US Dollar initially increased following the weekend news of an assassination attempt on former President Donald Trump. However, the Greenback quickly lost ground as investors speculated that a potential Trump election win might lead to looser fiscal policies. Fed Policy Outlook: Moody’s Credit Rating Agency predicts that the Federal Reserve could start easing monetary policy as early as this month, with potential rate cuts of 50-75 basis points in 2024 and an additional 100-125 basis points by 2025. This dovish outlook has bolstered gold prices, as lower rates make non-interest-bearing assets like gold more attractive. Economic Data: US Consumer Price Index (CPI) data came in weaker than expected, increasing the likelihood of a Fed rate cut, as reflected by falling US Treasury bond yields. The University of Michigan's Consumer Sentiment Index dropped to a seven-month low of 66.0 in July, missing expectations, which further supports the case for rate cuts. Additional Influences Global Factors: The People's Bank of China (PBoC) decided to halt gold purchases in June, as it did in May. By the end of June, China held 72.80 million troy ounces of gold.
OANDA:XAUUSDShort
by Forex48_TradingAcademy
2
USDJPY towards 154 or 166?Current Situation USD/JPY is holding at elevated levels near 161.00 during Asian trading on Tuesday. The high-risk sentiment, driven by expectations of a Fed rate cut, contributes to the pair's latest increase. All eyes are on Fed Chair Powell’s testimony for further indications on monetary policy. Recent Data and Technical Indicators Daily Chart: On Wednesday, July 3, USD/JPY posted a bearish Hanging Man candlestick pattern, followed by a bearish down day, confirming the bearish sentiment. Support and Resistance: Support: The pair found support at the April 29 high of 160.32, forming a price gap indicating potential exhaustion. Resistance: It is currently trading against resistance from the 50-period Simple Moving Average (SMA). Key Factors Fed Rate Cut Expectations: Speculation about a possible rate cut by the Federal Reserve in September has increased, with the CME’s FedWatch tool indicating a 76.2% probability, up from 65.5% the previous week. Powell’s Testimony: Market participants are awaiting Fed Chair Jerome Powell’s testimony on the Semiannual Monetary Policy Report to the US Congress for further insights into future policy direction. Japanese Yen Weakness: The JPY is extending losses due to foreign asset purchases by Japanese individuals under the Nippon Individual Savings Account (NISA) program and concerns over potential intervention by Japanese authorities in the FX markets. US Treasury Yields: Rising speculation about a Fed rate cut is putting pressure on US Treasury yields, which could limit the upside for the US Dollar. Market Sentiment and Projections Short-term Trend: USD/JPY remains in a short-term downtrend. However, given the exhaustion gap and the strong medium to long-term uptrend, there is a risk the pair could continue recovering. Potential Targets: Upside: If the pair surpasses 161.40, it would be a bullish signal, with further gains potentially reaching 162.90. Downside: A break below 160.20 would confirm further downside towards a probable target of 158.50.
Short
by Forex48_TradingAcademy
2
XAUUSD Heading Towards $2440?Current Situation The gold price (XAU/USD) registered a decline during the Asian session on Monday, following the news that the People’s Bank of China (PBoC) suspended gold purchases for the second consecutive month. This decision negatively impacted the gold price as China is the world's largest consumer of this precious metal. Recent Data Current Price: Gold has experienced a decline, stabilizing below the $2,400 threshold. Key Factors PBoC Purchases: The PBoC maintained its gold stock at 72.80 million troy ounces in June, contributing to the decrease in gold demand. US Interest Rates: The possibility of an interest rate cut by the Federal Reserve in the third quarter could support the gold price. Political Situation in France: Political uncertainty in France might increase the demand for safe-haven assets like gold. US Treasury Yields: A slight recovery in US Treasury yields makes gold less attractive as an alternative asset. Technical Forecast Resistances: $2,400 (psychological level) $2,450 (all-time high) Supports: $2,330-$2,340 Outlook In the short term, if buyers regain strength, the gold price could retest the six-week high of $2,393, with a potential break above the $2,400 threshold opening the path towards the all-time high of $2,450. However, a further decline could lead the price to challenge Friday’s low of $2,352, with a possible drop to the support zone at $2,340.
OANDA:XAUUSDLong
by Forex48_TradingAcademy
1
OPEC Secretary-General Affirms Resilient Oil Demand OPEC Secretary-General Affirms Resilient Oil Demand OPEC Secretary-General Haitham Al-Ghais stated at the St. Petersburg International Economic Forum on Thursday that oil demand remains resilient. "It's crucial to stay focused on the fundamentals," he emphasized. "Economic growth, supply, and demand are what drive our decisions." Al-Ghais noted that global demand increased by 2.3 million barrels per day in the first quarter, typically the weakest quarter due to global refinery maintenance. He anticipates continued strong demand in the coming months, particularly with the uptick in summer travel. Saudi Energy Minister Dismisses Bearish Response to OPEC+ Deal, Confident Market Will Adjust Saudi Energy Minister Prince Abdulaziz bin Salman dismissed the market's bearish reaction to OPEC+'s decision to gradually phase out voluntary output cuts, expressing confidence that the market will adjust. "Give it a day or two, reality will set in," he stated at the St. Petersburg International Economic Forum on Thursday. He criticized some banks and media outlets for their narratives around the meeting and reaffirmed that OPEC+ made the right decision. "I know that we did the best job," he asserted. The OPEC+ meeting initially triggered an oil selloff, exacerbated by short selling and movements in the options market, as traders worried about potential oversupply. However, Abdulaziz emphasized that OPEC+ retains the flexibility to pause or reverse production increases based on market conditions. OIL OUTLOOK Oil prices increased early as we mentioned, recovering from a four-month low, which was the lowest point since February. This drop was attributed to an unexpected surge in U.S. stockpiles, indicating softer demand than anticipated. Technically: The price has stabilized within the bearish zone, having already corrected the previous barrier which is 75.39. This suggests a continuation of the bearish trend, with potential targets at 72.500 and 70.570. A further break below 72.500 could lead the price down to 70.570. Conversely, if the price stabilizes above 75.400, it may indicate a bullish trend, potentially reaching up to 78.070. Pivot line: 75.390 Support lines: 72.50, 70.57, 68.12 Resistance lines: 76.80, 78.07, 79.35 The movement range will be between support 70.57 and Resistance 76.80 previous idea:
FX:USOILShort
by SroshMayi
Can Oil soar on June 2 OPEC+ cut hopes? Can Oil soar on June 2 OPEC+ cut hopes? WTI crude futures and Brent continue to recover from three-month lows. The rebound is potentially driven by expectations that OPEC+ will extend its output cuts of 2.2 million barrels per day into the second half of the year during its June 2 meeting. Additional support for crude prices came from the start of the U.S. summer driving season and a weaker dollar. Further data on the demand side will come from upcoming U.S. PCE to gauge the Federal Reserve's future monetary policy. A softer-than-expected reading on the PCE could increase the possibility of interest rate cuts, and potentially enhance the demand for energy. Deutsche Bank has maintained its Brent forecast at $83 per barrel for the second quarter and $88 for the second half of the year, assuming OPEC+ will sustain its current production policy on Sunday. Should prices move above the $80 level, WTI could test the 50-day moving average just above $81.1. The RSI suggests there is still room for prices to rise before reaching the overbought zone. Conversely, if prices fall below the $78 range, they might stabilize around the $76 mark.
BLACKBULL:WTI
by BlackBull_Markets
Options Blueprint Series: Pre and Post OPEC+ WTI Options PlaysIntroduction The world of crude oil trading is significantly influenced by the decisions made by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, collectively known as OPEC+. These meetings, which often dictate production levels, can lead to substantial market volatility. Traders and investors closely monitor these events, not only for their immediate impact on oil prices but also for the broader economic implications. In this article, we explore two sophisticated options strategies designed to capitalize on the volatility surrounding OPEC+ meetings, specifically focusing on WTI Crude Oil Futures Options. We will delve into the double calendar spread, a strategy to exploit the expected rise in implied volatility (IV) before the meeting, and the transition to a long iron condor, which aims to profit from potential post-meeting volatility adjustments. Understanding the Market Dynamics OPEC+ meetings are pivotal events in the global oil market, with decisions that can significantly influence crude oil prices. These meetings typically revolve around discussions on production quotas, which directly affect the supply side of the oil market. The anticipation and outcomes of these meetings create a fertile ground for volatility, especially in the days leading up to and immediately following the announcements. Implied Volatility (IV) Dynamics Pre-Meeting Volatility: In the days leading up to an OPEC+ meeting, implied volatility (IV) often rises. This increase is driven by market uncertainty and the potential for significant price moves based on the meeting's outcome. Traders buy options to hedge against or speculate on the potential price movements, thereby increasing the demand for options and pushing up IV. Post-Meeting Volatility: After the meeting, IV can either spike or drop sharply, depending on whether the outcome aligns with market expectations. An unexpected decision can cause a significant IV spike due to the new uncertainty introduced, while a decision in line with expectations can lead to a sharp drop as the uncertainty dissipates. Strategy 1: Double Calendar Spread The double calendar spread is a sophisticated options strategy that can potentially take advantage of rising implied volatility (IV) leading up to significant market events, such as the OPEC+ meeting. This strategy involves establishing positions in options with different expiration dates but the same strike price, allowing traders to profit from the increase in IV while managing risk effectively. Structure Long Legs: Buy longer-term call and put options. Short Legs: Sell shorter-term call and put options. The strategy typically involves setting up two calendar spreads at different strike prices (one higher and one lower), thus the term "double calendar." Rationale The rationale behind this strategy is that the longer-term options will experience a greater increase in IV as the event approaches, inflating their premiums more than the shorter-term options. As the short-term options expire, traders can realize a profit from the difference in premiums, assuming IV rises as expected. Strategy 2: Transition to Long Iron Condor As the OPEC+ meeting date approaches and the double calendar spread positions reach their peak profitability due to the elevated implied volatility (IV), it becomes strategic to transition into a long iron condor. This shift aims to capitalize on potential volatility changes and capture profits from the expected IV drop. Structure Closing the Double Calendar: Close the short-term call and put options from the double calendar spread. Setting Up the Long Iron Condor: Sell new OTM call and put options with the same expiration date as the long legs of the double calendar spread. The result is a position where the trader holds long options closer to the money and short options further out, creating a long condor structure. Rationale The rationale for transitioning to a long iron condor is to capture profits from a potential decrease in IV after the OPEC+ meeting. Practical Example To illustrate the application of the double calendar spread and the transition to a long iron condor, let's walk through a detailed example using hypothetical WTI Crude Oil Futures prices. Double Calendar Spread Setup 1. Initial Conditions: Current price of WTI Crude Oil Futures: $77.72 per barrel. Date: One week before the OPEC+ meeting. 2. Long Legs: Buy a call option with a strike price of $81, expiring on Jun-7 2024 @ 0.32. Buy a put option with a strike price of $74, expiring on Jun-7 2024 @ 0.38. 3. Short Legs: Sell a call option with a strike price of $81, expiring on May-31 2024 @ 0.05. Sell a put option with a strike price of $74, expiring on May-31 2024 @ 0.09. Note: We are using the CME Group Options Calculator in order to generate fair value prices and Greeks for any options on futures contracts. Transition to Long Iron Condor 1. Closing the Double Calendar: Close the short-term call and put options just before they expire @ 0.01 (assuming they are OTM on Friday May-31, before the market closes for the weekend). 2. Setting Up the Iron Condor: Sell a call option with a strike price of $82, expiring on Jun-7 2024 @ 0.13. Sell a put option with a strike price of $73, expiring on Jun-7 2024 @ 0.18. 0.11 and 0.17 are estimated values assuming WTI Crude Oil Futures remains fairly centered around 77.50 and that IV has risen into the OPEC+ meeting weekend. Transitioning from the Double Calendar to the Long Iron Condor would be done on Friday May-31. 3. Resulting Position: You now hold a long call at $81, a long put at $74, a short call at $82, and a short put at $73, forming a long iron condor. The risk of the trade has been reduced by half (assuming the real fills coincide with the estimated values above) from 0.56 to 0.27 = $270 with a potential for reward of up to 0.73 (1 – 0.27) = $730. This practical example demonstrates how to effectively implement and transition between the double calendar spread and the long iron condor to navigate the volatility surrounding an OPEC+ meeting. Importance of Risk Management Effective risk management is crucial when implementing options strategies, particularly around significant market events like the OPEC+ meeting. The volatility and potential for sharp market moves require traders to have robust risk management practices to protect their capital and ensure long-term success. Avoiding Undefined Risk Exposure Undefined risk exposure occurs when traders have no clear limit on their potential losses. This can happen with certain options strategies that involve selling naked options. To avoid this, traders should always define their risk by using strategies that have built-in risk limits, such as spreads and condors. Precise Entries and Exits Making precise entries and exits is critical in options trading. This involves: Entering trades at optimal times to maximize potential profits. Exiting trades at predetermined levels to lock in gains or limit losses. Adjusting trades based on market conditions and new information. Additional Risk Management Practices Diversification: Spread risk across different assets and strategies. Position Sizing: Allocate only a small percentage of capital to each trade to avoid significant losses from a single position. Continuous Monitoring: Regularly review and adjust positions as market conditions evolve. By adhering to these risk management principles, traders can navigate the complexities of the options market and mitigate the risks associated with volatile events like OPEC+ meetings. Conclusion Navigating the volatility surrounding significant market events like the OPEC+ meeting requires strategic planning and effective risk management. By implementing the double calendar spread before the meeting, traders can capitalize on the anticipated rise in implied volatility (IV). Transitioning to a long iron condor after the meeting allows traders to benefit from potential post-meeting volatility adjustments or price stabilization. These strategies, when executed correctly, offer a structured approach to managing market uncertainties and capturing profits from both pre- and post-event volatility. The key lies in precise timing, appropriate strike selection, and diligent risk management practices to protect against adverse market movements. By understanding and applying these sophisticated options strategies, traders can enhance their ability to navigate the complexities of the crude oil market and leverage the opportunities presented by OPEC+ meetings. When charting futures, the data provided could be delayed. Traders working with the ticker symbols discussed in this idea may prefer to use CME Group real-time data plan on TradingView: www.tradingview.com This consideration is particularly important for shorter-term traders, whereas it may be less critical for those focused on longer-term trading strategies. General Disclaimer: The trade ideas presented herein are solely for illustrative purposes forming a part of a case study intended to demonstrate key principles in risk management within the context of the specific market scenarios discussed. These ideas are not to be interpreted as investment recommendations or financial advice. They do not endorse or promote any specific trading strategies, financial products, or services. The information provided is based on data believed to be reliable; however, its accuracy or completeness cannot be guaranteed. Trading in financial markets involves risks, including the potential loss of principal. Each individual should conduct their own research and consult with professional financial advisors before making any investment decisions. The author or publisher of this content bears no responsibility for any actions taken based on the information provided or for any resultant financial or other losses.
NYMEX:CL1!Education
by traddictiv
Event-Driven Strategy using WTI Weekly OptionsNYMEX: WTI Futures ( NYMEX:CL1! ) and WTI Weekly Options ( GETTEX:LO5 ) OPEC+, the coalition of the world’s leading oil producers, will convene on June 2nd to decide production policy for the second half of the year. The powerful oil cartel consists of 13 OPEC members and 9 nonmember participants, and together produces about 59% of global oil production. This amounted to 48 million barrels per day (mn b/d) in 2022, estimated by the US Energy Information Administration (EIA). Many analysts expect OPEC+ to continue the voluntary cut of 2.2 mn b/d, due to expire at the end of June. This voluntary cut, introduced in November 2023, adds to 3.6 mn b/d of production cut that have reduced the members’ crude output by about 5.8 mn b/d, or about 5% of global supply, since November 2022. I consider the move an attempt to shore up prices against higher US oil production and an uncertain economic outlook in China. OPEC+ meeting is a significant event in the global crude oil market. We could liken its importance to that of the Federal Reserve meetings for equities and bonds. The group’s decision could tilt the balance of supply and demand one way or the other. Here are three possible outcomes: • No change: To renew existing cuts of 2.2 mn b/d through the end of the year. • Additional cuts. This would reduce global crude oil supply. • Ease of cuts. This would release more oil to the global market. The oil market may stay calm if the OPEC+ decision conforms to investor expectations of no change. A surprise announcement of additional cuts would likely send oil prices skyrocketing. But any pullback from current cuts could sink oil prices down. This provides a good setting for event-driven trading strategies. Monitoring Crude Oil Market Sentiment Real Time For a trading strategy to work, the trader needs to understand the market sentiment ahead of the actual event. While analysts give out opinions, it is the investors who put money in their mouth. Therefore, for unbiased decision making, we should look into trading data. The CME Group OPEC Watch Tool is a great analytical tool for crude oil traders. It uses NYMEX WTI crude oil option prices to calculate the probabilities of certain outcomes from the nearest weekly and monthly options that expire around the OPEC meeting. In essence, it uses actual trading data, and go the extra mile to transform it into useful insights. This valuable tool is free and can be accessed via CME Group website. The title chart includes a snapshot of CME Group OPEC Watch Tool. As of May 26th: • OPEC Watch Tool expects a 79.1% probability of no change; • There is a 18.8% probability of ease of cuts: • Additional cuts remain a remote probability, at 2.2%. I would like to point out that the market often exhibits overly pessimistic or overly optimistic sentiment. OPEC Watch Tool shows the collective wisdom of crude oil options traders. However, the trades are not scientific forecast. Market sentiment could change very rapidly. With this in mind, we need to closely monitor it with real-time trading data. If, through independent analysis, a trader establishes an opinion very different to what the market suggested, he or she may express it with a trade position and wait for the market to correct its faulty assumptions. Trading with NYMEX WTI Weekly Options We could consolidate the three possible OPEC+ decisions into two: • Within Expectation. No changes. • Exceeding Expectation. More cuts or less cuts. Investors expect OPEC+ to maintain its current cuts. If that turns out to be the case, oil prices may not move much following the announcement. If a trader hosts this view, how could he or she turn it into a trade strategy? The trader could consider selling short-dated out-of-the-money (OTM) WTI crude oil options. The July WTI futures contract ($CLN4) settled at $77.80 a barrel last Friday. Selling OTC strikes on WTI weekly options would enable the trader to collect an upfront premium. The first Friday after the OPEC+ announcement is June 7th. The weekly options ($LO1M4) will last only 12 days before its expiration. How do we select options strikes to sell? There are really no rules of thumbs. For illustration purposes, let us pick an OTC call strike approximately $5 above current market price, and a put strike about $5 below. • Last Friday, the 82.75 call strike settled at 17 cents. Each WTI weekly option contract has a notional value of 1,000 barrels. Therefore, the trader would collect $170 premium for selling 1 call. • The $72.75 put strike settled at 29 cents. The trader would get $290 for selling 1 put. • If the trader sells 1 call and 1 put, he or she could collect $460 for just 12 days. Words of warning for options sellers: • CME Group requires options sellers to deposit $6,001 margin for each July contract as the time of writing. Therefore, this strategy requires an investment of $12,002 for both call and put. • If OPEC+ acts as expected and the oil market stays calm, the trader would get the margin deposit back when the options expire worthless. • However, if oil prices move up above the call strike, the trader could incur a loss, potentially wiping out all the margin deposit, and probably more. • If oil prices drop below the put strike, the trader would also experience a loss. If the trader holds an opposite view, he or she could buy the OTC call or put options, depending on which direction the trader is leaning towards. For a small upfront premium, the trader could establish a position on crude oil, and potentially collect a big payout if OPEC+ changes heart. For those who are uncertain of which way OPEC+ would go, but are convinced that they would change courses, traders could buy both OTC calls and OTC puts at the same time. This is an example of options strangle strategy. Happy Trading. Disclaimers *Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services. CME Real-time Market Data help identify trading set-ups and express my market views. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com
NYMEX:CL1!Long
by JimHuangChicago
USOIL: Unraveling Current Market DynamicsThe analysis of USOIL (West Texas Intermediate) takes into account multiple factors influencing the current oil market. Geopolitical tensions: Growing tensions in Gaza and concerns about potential attacks from Iran in the Middle East are adding a risk premium to oil prices. These events could lead to disruptions in oil supply, increasing price volatility. Supply concerns: The OPEC's warning about a possible market shortage during the summer indicates concern about the balance between supply and demand. If supply fails to meet expected demand, prices could further increase. Economic factors: Pressure on the US dollar, along with disappointing unemployment and US Producer Price Index (PPI) data, has contributed to weakening the dollar. However, a weaker dollar could make oil more attractive to international buyers, increasing demand and supporting prices. Technical outlook: Technical analysis suggests that oil prices are rising, with WTI approaching $90. If the resistance level at $87.12 is surpassed, prices are expected to reach $90 and even $94 in case of further geopolitical tensions. However, support levels at $83.34 and $80.63 could offer a rebound opportunity if prices were to decline.
TVC:USOILLong
by Forex48_TradingAcademy
1
USDCAD| FED vs BOC, who will win?The USD/CAD is currently hovering around 1.3540 during the Asian hours on Friday, indicating potential signs of a halt to its four-day consecutive negative trend. This stabilization could be attributed to the positive sentiment surrounding the US dollar, fueled by the Federal Reserve's hawkish stance on maintaining higher interest rates. Specifically, the US annualized GDP recorded a growth of 3.4% in the fourth quarter, surpassing market expectations. Governor Christopher Waller's cautious remarks about delaying rate cuts have helped temper expectations of rate reductions in 2024. On the other hand, the Canadian dollar has seen an uptick due to prospects of foreign currency inflows, supported by the rise in West Texas Intermediate (WTI) crude oil prices. This growth is linked to expectations that OPEC+ will continue production cuts. These developments have bolstered confidence in Canada's economic outlook, reducing expectations of a more accommodative monetary policy from the Bank of Canada (BoC). Therefore, I anticipate a decline towards 1.34 before a recovery towards 1.36. On a weekly basis, the market is consolidating, with too much uncertainty surrounding the future policies of central banks at the moment. It's important to remain cautious and prudent. Best wishes to all for successful trading.
Long
by Forex48_TradingAcademy
1
USOIL | Downward to $73.50 before touching $80The price of WTI oil maintains an upward direction after Israel rejected Hamas' ceasefire agreement. West Texas Intermediate (WTI), the benchmark for U.S. crude oil, rose by 0.25% towards the end of the North American session, while the conflict between Israel and Hamas intensified with Israel rejecting a ceasefire offer. On Friday, the Israeli army continued its offensive in the Gaza Strip, resulting in a 3% increase in oil prices compared to the previous day. Additionally, refinery closures in the United States led to higher gasoline and diesel prices. Ukraine's attacks on two oil refineries in southern Russia, and the latter exceeding its plans for crude oil exports in February compared to the agreement with OPEC+, favored the increase in WTI prices. WTI Price Analysis: Technical Outlook Oil prices are expected to remain within a range but tilted downwards, as the 200-day moving average (DMA) at $77.29 remains the first resistance level for prices. A breach of the latter could pave the way for further gains towards $80.00 per barrel. However, despite the bullish trend, the Relative Strength Index (RSI) has maintained a flat slope, and strong resistance could lead to challenging the 20-day DMA at $74.53. A breach of the latter will expose the recent swing low at $71.46. Currently, with the daily closure of a bearish candle, specifically a doji at the 0.70% Fibonacci level, a downturn is expected to the $73.30 level, where the price could find support and then continue the bullish trend with the goal of reaching the $80 level, i.e., surpassing the buying liquidity level at $79.78. Greetings and have a good start to the week everyone.
TVC:USOILLong
by Forex48_TradingAcademy
2
USD/CAD: Upsurge with US CPI Data and Canadian EmploymentThe USD/CAD exchange rate is gaining momentum for the second consecutive day during the early Asian session on Wednesday. This increase is supported by the US January Consumer Price Index (CPI) inflation data, which is boosting the US Dollar and government bond yields. The Core CPI, which excludes volatile food and energy prices, rose by 3.9%, surpassing the market consensus of 3.7%. On a monthly basis, both the CPI and the Core CPI increased by 0.3% and 0.4% respectively. Canadian labor market data was surprisingly strong, with an increase of 37,000 jobs that more than doubled forecasts. A healthier labor market outlook could persuade the Bank of Canada (BoC) to delay interest rate cuts until June rather than April. Governor Tiff Macklem stated that the central bank has shifted its focus from debating whether interest rates are high enough to how long the central bank should keep rates at current levels. Retail Sales and Producer Price Index (PPI) data are scheduled for Thursday and Friday respectively. These data could provide a clear direction for the USD/CAD exchange rate. On a daily basis, the price is approaching a reversal zone marked on the chart. On February 12th, the market retraced to a very physiological level at 1.3427 before starting a rally. Today, the price may dip slightly before continuing its bullish run, breaking out of the reversal zone and subsequently retesting it, with a target at 1.3740. Best regards and happy trading to everyone.
Long
by Forex48_TradingAcademy
1
USDCAD Ready for a new high to 1.3650?The USD/CAD exchange rate continues its decline from around the mid-1.3500s, reaching its highest level in almost two months and remaining under selling pressure for the second consecutive day on Wednesday. The reduction in the forecast for domestic oil production growth for 2024 by the US Energy Information Administration (EIA) in the February Short-Term Energy Outlook report released on Tuesday helped alleviate concerns about oversupply. This, along with recent attacks on ships by Iranian-backed Houthi rebels in the crucial Red Sea, which accounts for nearly 12% of global oil trade, supported oil prices, thereby favoring the commodity-linked Canadian dollar. The overnight decline in US Treasury bond yields prompted some profit-taking in USD, especially after the post-NFP rally, although expectations of a hawkish stance from the Federal Reserve (Fed) should help limit deeper losses. Incoming US macroeconomic data suggests a strong economy, giving the Fed more room to maintain higher interest rates for longer. On the daily chart, a price movement above the psychological level of 1.3540 followed by a retracement towards the demand zone is observed, where a technical rebound around the 1.3420 level is expected, potentially offering a long entry opportunity with a target at 1.3630. The M15 timeframe will be crucial for entry evaluation, awaiting any good market entry signals. Patience and proper capital management are key. Greetings and have a good day to everyone.
Long
by Forex48_TradingAcademy
2
AUDUSD is ready for a reversal with target 0.631The AUD/USD indicates a slight uptick, trading around 0.6580 on Tuesday after registering losses in the previous session. The improvement in NAB's Business Confidence may have contributed to supporting the Australian Dollar. The evident resumption of the downward trend around the Australian dollar led the AUS/USD to leave behind a two-day recovery, remaining under pressure in the sub-0.6600 zone at the beginning of a new trading week. So far, dollar dynamics, coupled with the still-lacking convincing signs of an economic recovery in post-pandemic China, are expected to continue dictating the mood around the spot and keeping its price action subdued, all in combination with an anticipated steady hand by the RBA in its February meeting. Returning to the RBA, it is widely expected to leave its official cash rate unchanged at 4.35% next month. The downtick in inflation figures recorded in December, along with further cooling of the (still tight) labor market, have underpinned that consensus among market participants for the time being. That said, the near-term outlook for the AUD remains tilted to the dovish side, a view that could gain further traction if the Federal Reserve continues to push back bets for an interest rate cut in the next few months. On the daily chart, I have highlighted a possible short scenario likely to unfold if confirmation is received around the 0.66-0.6650 level, with a final target of 0.63 and the recapture of all sell-side liquidity. Greetings and have a good day of trading to everyone.
Short
by Forex48_TradingAcademy
3
Advanced Forex Trading Strategy M15The trading strategy under examination is tailored for the M15 timeframe in the forex market, focusing on identifying supply and demand zones to make well-informed trading decisions. Let's delve into the key steps to successfully implement this strategy. Step 1: M15 Chart Analysis Position yourself on an M15 timeframe chart to gain a more detailed view of the market. This shorter time frame allows for capturing swift movements and identifying potential trading opportunities. Step 2: Identification of Supply and Demand Zones Utilize technical analysis tools such as supports, resistances, and volume indicators to clearly pinpoint supply and demand zones. Demand areas represent points where price is expected to rise, while supply zones indicate potential downward reversal points. Step 3: Confirmation of Demand Zone Breakout Wait for the breakout of a demand zone, accompanied by a bounce. This confirms the strength of the movement and suggests a potential change in the price direction. Step 4: Waiting for Price Bounce Above the Broken Zone After the demand zone breakout, observe price behavior and wait for it to return above the same zone. This confirms the effectiveness of the breakout and suggests a potential entry opportunity. Step 5: Identification of Supply Zone Once the price has surpassed the demand zone, identify a possible supply zone. This is the level where price is expected to encounter resistance. Step 6: Market Entry and Goal Planning Enter the market when the price reaches the identified supply zone, aiming to capture the downward movement. Set the target corresponding to the minimum that led to the last uptrend, intending to capitalize on the potential downward movement. Conclusions: This advanced forex trading strategy on the M15 timeframe is based on analyzing supply and demand dynamics. Always remember to manage risk carefully and adapt the strategy to evolving market conditions.
Education
by Forex48_TradingAcademy
1
USOIL | How will geopolitical tensions influence the price?The West Texas Intermediate (WTI) price stands at around $72.70 per barrel during Thursday's Asian session, highlighting an upward trend supported by optimism generated by the Organization of the Petroleum Exporting Countries (OPEC). OPEC's monthly report anticipates robust growth in oil demand for 2024 and 2025, forecasting an increase of 2.25 million barrels per day (bpd) in 2024 and 1.85 million bpd in 2025. From a geopolitical perspective, disruptions in the supply chain in the Red Sea are preventing a more significant decline in crude oil prices, with attacks by Houthi forces in the area. The United States responded with strikes against the Houthi, and tensions escalated when the Houthi rebels targeted a U.S. ship. Internally, the American Petroleum Institute (API) reported an unexpected increase in weekly crude oil stocks, while the market awaits the upcoming Energy Information Administration (EIA) report, expected to show a decrease of 0.313 million barrels compared to the previous reading of 1.338 million barrels.
TVC:USOILLong
by Forex48_TradingAcademy
1
USOIL long: Market dynamics and Future outlookThe analysis of the US oil market (West Texas Intermediate, WTI) presents an intriguing scenario. Currently, the WTI price is recovering from recent losses, trading around $72.33 per barrel. This rise in oil prices is driven by concerns about potential supply disruptions following recent events, where Yemen's Houthis have questioned the UN resolution on Red Sea navigation. Meanwhile, the USD/CAD pair has fallen close to 1.3360, failing to stay above the crucial resistance of 1.3400. The Canadian dollar continues to struggle as the demand for safe-haven assets decreases due to an improved risk appetite among market participants. In the oil sector, prices are showing a moderate recovery as tensions in the Middle East deepen. Attacks on commercial oil tankers passing through the Red Sea are causing shipment delays and supply shortages. It is noteworthy that Canada is the leading exporter of oil to the United States, and higher oil prices support the Canadian dollar. My forecast, also backed by the rally of the USD/CAD pair, is for a long entry at the December low. Following the five-year seasonal trend, the pair should start rising from January until March. I will continue to provide updates on this position. Greetings from Nicola.
TVC:USOILLong
by Forex48_TradingAcademy
1
USDJPY | After the CPI : It goes up!The analysis of the USD/JPY (US Dollar/Japanese Yen) exchange rate is based on several key aspects: US Inflation and CPI: The increase in US inflation in December (3.4% against the expected 3.2%) signals a strong economy and reduces the likelihood of interest rate cuts by the Federal Reserve, favoring the US dollar. US Unemployment Insurance Claims: Lower-than-expected claims (202K against 210K expected) indicate a strong US labor market, supporting the dollar. Market Expectations and Interest Rates: Expectations for a rate cut in March have decreased due to rising inflation. Higher interest rates tend to strengthen a currency, in this case, the US dollar. Japanese Economic Indicators: Upcoming data on Japan's trade balance and current account will impact the JPY. Weak data could further weaken the yen. Technical Analysis of USD/JPY: Technically, USD/JPY has shown an uptrend, reaching a short-term high of 146.41. The 200-hour Simple Moving Average (SMA) and the congestion area between the 50-day and 200-day SMAs are key technical indicators to monitor. Breaking these thresholds could indicate further upward movements. In conclusion, recent US economic data and monetary policy expectations favor the strengthening of the dollar against the yen. However, future economic data from Japan and the US, including PPI data, will be crucial in determining USD/JPY's future direction. After the CPI, the trend seems clearly outlined towards an upward move, targeting the supply zone at 147.15. Moreover, the price is breaking a supply zone that could serve as support for an imminent bullish rebound. Happy trading to all from Nicola.
Long
by Forex48_TradingAcademy
1
USOIL: Route map 71.50-79 awaiting the FED!Observing the price of West Texas Intermediate (WTI), I notice an upward trend, with the price having retested the bullish trendline after breaking through the $74 level. Now, I expect a slight pullback towards $71.50 before a significant rebound towards $79 per barrel. However, from a macroeconomic perspective, I've also detected growing concerns about the stability of demand due to an increase in U.S. gasoline and distillate inventories, leading to a decrease in prices. I am particularly mindful of the impact of Middle East tensions on energy markets. These conflicts directly influence logistics and shipping, so much so that I've observed companies diverting their ships from the Suez Canal route to avoid waters infested with Houthi rebels, significantly changing commercial routes between Europe and Asia. The arrival of an Iranian warship further complicates the situation. Additionally, I am monitoring the ongoing conflict between Israel and Hamas, aware of the risk that it might involve neighboring countries. I've noticed that Iran has suspended crude shipments to China to secure higher prices. This move is particularly interesting as it follows China's advance purchase of a significant portion of its annual oil demand, enjoying a discount on imports from sanction-hit Iran. In conclusion, my personal analysis describes a complex WTI oil market influenced by a variety of geopolitical and technical factors. I am closely monitoring how Middle East tensions, Iran's strategies, and technical indicators affect the direction of WTI prices. Best regards and have a great weekend, from Nicola.
TVC:USOILLong
by Forex48_TradingAcademy
USOIL Crude Oil WTI Price Prediction for Winter The potential for an increase in oil prices looms as supply disruptions in Libya unfold. Additionally, heightened tensions in the Middle East, fueled by another attack on a container ship in the Red Sea and explosions in Iran, contribute to the uncertainty. Shipping giants temporarily halted Red Sea shipments last month due to attacks by Houthi rebels, who were influenced by the conflict between Hamas and Israel. On a recent Wednesday, the Yemeni militant group, supported by Iran, claimed responsibility for targeting a container ship en route to Israel. Concurrently, OPEC announced its members' commitment to unity and cohesion within the organization, emphasizing their dedication to shared objectives. Adding to the complex landscape, last month saw Angola, a member of OPEC for 16 years, decide to exit the cartel due to disputes over quotas. In light of these developments, my forecast for oil prices is set at $80 by March 2024.
TVC:USOILLong
by TopgOptions
WTI → Oil prices drop as the USD recovers, OPEC cutsThe outlook has turned bearish for the WTI. This is mainly because the Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) reside deep in negative territory and as the price is seen below its 20,100 and 200-day Simple Moving Averages (SMA). This indicates that on the shorter and broader scales, the sellers are dominating. Resistance Levels: $75.00, $76.15 (20-day SMA), $77.00 Support Levels: $72.80, $72.30, $71.00
BLACKBULL:WTIShort
by tradingconmike
WTI BULLISH OUTLOOKOil prices surged during the latest OPEC+ meeting discussions, showcasing a 1.2% rise in U.S. crude futures at $78.77 per barrel and a 1.1% climb in Brent crude to $83.78 per barrel. The market buzzed with expectations of deeper output cuts, despite existing pledges from OPEC+ members to cut global oil output by about 5 million barrels per day. The delay in the meeting, prompted by African nations contesting their 2024 production targets, fueled speculations of potential additional cuts. Amidst bearish U.S. crude inventory data and concerns over China's slowing economic growth affecting oil demand, the market maintained a positive outlook. Analysts hinted at the possibility of expanded supply reductions beyond existing voluntary measures, with the potential of an added 1.0 million barrel-a-day cut to stabilize oil prices. However, caution lingered about a "buy the rumor-sell the fact" scenario, and technical indicators pointed towards a trend reversal, indicating a potential retreat to $73.91 if the current bullish trend eases. Overall, the oil market remained buoyant on prospects of increased output cuts by OPEC+ members, brushing aside bearish inventory reports and economic slowdown worries. The discussions continue to shape the market trajectory, showcasing a delicate balance between supply and demand dynamics in the energy sector. Risk Disclosure: Trading Foreign Exchange (Forex) and Contracts of Difference (CFD's) carries a high level of risk. By registering and signing up, any client affirms their understanding of their own personal accountability for all transactions performed within their account and recognizes the risks associated with trading on such markets and on such sites. Furthermore, one understands that the company carries zero influence over transactions, markets, and trading signals, therefore, cannot be held liable nor guarantee any profits or losses.
BLACKBULL:WTILong
by legacyFXofficial
Evaluating OPEC+ Compliance Levels for Cautious Oil TradingAs you are aware, the upcoming OPEC+ member countries to implement potential oil-supply cuts has sparked considerable interest and speculation within the trading community. Today, I would like to draw your attention to the importance of evaluating the compliance levels of these member countries and how it presents a potential opportunity for cautious oil trading. The proposed oil-supply cuts have been designed to stabilize oil prices amidst the ongoing global economic uncertainties. However, it is crucial to assess the actual compliance of OPEC+ member countries with these agreed-upon cuts. By doing so, we can gain valuable insights into the potential impact on global oil supply and demand dynamics. To effectively evaluate compliance levels, it is recommended to closely monitor official statements, production data, and any relevant news updates from OPEC and non-OPEC countries. Analyzing these factors will provide a clearer understanding of how closely member countries are adhering to their commitments. While evaluating compliance levels, it is important to maintain a cautious approach towards trading oil. The current market conditions are highly volatile and unpredictable, influenced by various geopolitical and economic factors. It is advisable to exercise prudence and carefully assess the potential risks associated with any trading decisions. In light of the potential opportunities arising from the evaluation of compliance levels, I encourage you to consider engaging in oil trading. However, it is crucial to approach this market with a cautious mindset, ensuring that you have a well-thought-out trading strategy in place. Diversification and risk management should be at the forefront of your decision-making process. As always, it is essential to stay informed and updated on the latest developments in the oil market. By leveraging reliable sources of information, you can make informed trading decisions and navigate the market with greater confidence. In conclusion, evaluating the compliance levels of OPEC+ member countries with the proposed oil-supply cuts presents an opportunity for cautious oil trading. However, it is imperative to remain vigilant, assess the risks involved, and develop a sound trading strategy that aligns with your risk appetite. Should you require any further information or assistance in evaluating compliance levels or refining your trading strategy, please do not hesitate to comment below. Thank you for your attention, and I wish you successful and prudent trading in these challenging times.
TVC:USOILLong
by bryandowningqln