BRENT CRUDE OIL (LCOc1) ANALYSIS
- Impending Russian oil embargo has markets on the sting.
- Secure haven greenback muting crude oil positive aspects.
- Key technical sample unfolding.
BRENT CRUDE OIL FUNDAMENTAL BACKDROP
Brent crude oil stays elevated regardless of buying and selling marginally decrease post-Asia. The U.S. greenback has discovered some upside after markets react to an more and more hostile state of affairs in Ukraine, driving buyers to security within the type of U.S. Treasury bonds (10-year) and rising the demand for the dollar.
Staying on the subject of Russia and Ukraine, the a lot talked about oil ban by the EU is because of be determined within the upcoming days in line with European Fee President Ursula von der Leyen. Up to now, the ban has confirmed harder than initially anticipated with landlocked international locations like Hungary involved about unfavourable implications ought to the ban undergo, that means brent crude ought to stay round present ranges main as much as the announcement.
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One other attention-grabbing growth that arose yesterday was the Russians technique to extend exports to its fellow BRICS member states together with Brazil, India, China and South Africa at engaging value factors, together with creating joint refineries with the block.
U.S. knowledge dominates the calendar for the remainder of the day with deal with the FOMC minutes from the Could meet (see calendar under). I will likely be in search of clues round upcoming charge hikes regarding 50bps and 75bps will increase respectively.
Supply: DailyFX Financial Calendar
BRENT CRUDE (LCOc1) DAILY CHART
Chart ready by Warren Venketas, IG
Technically, brent crude price motion continues to imitate an ascending triangle sample (black) typically related to an extension of a previous bullish development. On this case, we have now seen bulls take a look at triangle assist on three earlier events (blue) and will solely be a matter of time earlier than the barrier is breached.
Key resistance ranges:
- Triangle resistance
Key assist ranges:
- $109.03 (23.6% Fibonacci)/20-day EMA (purple)
- 50-day EMA (blue)
- Triangle assist
IG CLIENT SENTIMENT: BULLISH
IGCS exhibits retail merchants are marginally NET LONG onCrude Oil, with 42% of merchants at present holding lengthy positions (as of this writing). At DailyFX we sometimes take a contrarian view to crowd sentiment nevertheless, after latest modifications in positioning we choose a short-term bullish bias.
Contact and comply with Warren on Twitter: @WVenketas