Dollar bulls and bears were both restrained this week with prices stuck in a tight range as investor anxiety mounts ahead of Friday’s heavily anticipated Jackson Hole gathering. This event has seized center stage with markets most likely searching for key hints on US rate hike timings which could dispel the period of uncertainty. There may be a possibility of Yellen addressing the inflation dilemma in the States while also keeping the doors open for a live meeting in September to raise US rates. Although anxiety continues to cloud the markets, optimism over the Fed taking action has already been bolstered this week following hawkish comments by other Fed members and strong US housing data which eased concerns over the US economy. Some attention may be directed towards Thursday’s Core durable goods orders report which if exceeds expectations may compound to the attributes that provide a firm case for the Fed to raise rates in December.
The Dollar Index has oscillated between losses and gains this week but still remains bearish on the daily timeframe. Prices are trading below the daily 20 SMA while the MACD has crossed to the downside. Previous support around 95.00 could transform into a dynamic resistance that opens a path towards 94.00.
Oversupply fears entice WTI bears
WTI Crude experienced a sharp decline on Wednesday with prices sinking towards $46.50 following the unexpected increase in US crude stocks that rekindled concerns over the excessive oversupply in the global markets. Crude oil stockpiles have been incessantly rising while rig counts have risen for eight consecutive weeks reinforcing the fundamentals of an excessive oversupply. For an extended period, oil simply ignored the bearish fundamentals as the inflated expectations over OPEC securing a freeze deal propelled prices to shocking levels. While OPEC members may be commended on their ability in exploiting the oil price sensitivity to create speculative boosts in oil prices, this will come at a heavy cost.
The cartel's credibility balances on a thin line and if September’s informal meeting follows the same fashion as Doha’s meeting, then not only will the credibility be tarnished further but oil could be left vulnerable to extreme losses. It should be kept in mind that OPEC faces an obvious prisoner’s dilemma from cutting production as such could provide an incentive for US shale to jump back into the markets.
WTI bears have emerged and the fears of Chinese crude demand diminishing as Beijing investigates alleged tax evasions in the oil industry may keep prices depressed. Bears could reclaim control with the horrible combination of oversupply fears and concerns that demand may be faltering encouraging sellers to install repeated rounds of selling on oil. From a technical standpoint, a breakdown below $46 could open a path towards $44.
GBPUSD elevated by Dollar vulnerability
Sterling was resilient against the Dollar this week and this has nothing to with an improved sentiment towards the Sterling but Dollar weakness from fluctuating US rate hike expectation. Although economic data from the UK economy has displayed signs of stability consequently questioning if the Brexit had any negative impact, it remains quite early to come to a conclusion with more time needed to truly size up the Brexit effect. Sterling still remains the worst performer among major currencies since the referendum with further declines expected if expectations heighten over the Bank of England implementing further stimulus measures. Investors may direct their attention towards the second quarter GDP report released on Friday which could offer clarity on how the UK economy has fared in a period of global uncertainty. A disappointing GDP figure may renew speculations over the BoE cutting UK interest rates to near zero before year end.
Commodity spotlight – Gold
Gold abruptly fell to four-week lows around $1325 on Wednesday as the persistent uncertainty over the Fed raising US rates in 2016 encouraged anxious investors to relinquish their bullish bets. This precious metal remains highly sensitive to US rate hike expectations with explosive movements expected on Friday if Yellen provides investors the clarity they have long sought. If Hawks come out to play on Friday then Gold bears could be installed with enough inspiration to break below the stubborn $1315 support. On the other hand, if investors are left empty handed and fail to retrieve any direction on when US rates will be increased then Gold could lurch higher. From a technical standpoint, bulls need to keep above $1315 to validate the current bullish uptrend.
Sentiment towards the US economy was elevated on Friday following the hawkish comments from Janet Yellen which bolstered expectations over the Federal Reserve raising US rates in 2016. Investors were gifted the clarity long sought when Yellen suggested that the case for raising US rates had strengthened in recent months consequently uplifting the Dollar. For an extended period, domestic data from the States has followed a positive path while the easing Brexit anxieties continue to provide some leeway for the central bank to take action. While there have been ongoing talks of September being a live meeting to raise US rates, it seems likely that the Fed waits for further positive domestic data to justify raising US interest rates in December. With the Jackson Hole meeting dispelling the period of uncertainty, the Dollar could trade higher as bets mount over the Fed breaking this tradition of central bank caution. Focus may be directed towards the pending all-important U.S non-farm payrolls report this week which if exceeds expectations could provide another compelling reason for the Fed to act.
The Dollar Index surged with ferocity on Friday following Yellen’s comments which renewed hopes of the Fed pushing the button. Although prices are currently in the boundaries of still being bearish on the daily timeframe, a breakout above 96.00 could entice bulls to send prices higher.
Global stocks still pressured
Stock markets were vulnerable to losses last week as the combination of Dollar strength and renewed hopes over the Fed raising US rates enticed sellers to install repeated rounds of selling. Asian markets have already started Monday on a shaky footing and this could trickle into European markets later today. Although the period of uncertainty over when the Fed may raise rates has been dispelled, the persistent concerns over the global economy and depressed oil prices could ensure stocks remain depressed moving forward. With the attributes of a bear trend still visible, it could take an unexpected catalyst to trigger a heavy selloff in global stocks.
Commodity spotlight – Gold
Gold violently vibrated between losses and gains on Friday before sinking lower following Janet Yellen’s hawkish comments which heightened hopes of a US rate hike this year. This metal remains extremely sensitive to US rate hike expectations and could be poised for further declines if bets mount over the Fed breaking the tradition of caution by raising rates. Even if risk aversion attempts to keep the precious metal buoyed, the viscously appreciating Dollar may simply cap further upside gains. From a technical standpoint, prices are trading below the daily 20 SMA while the MACD has crossed to the downside. Bears are currently in control and a decisive break down below $1315 could open a path towards $1285.
WTI Crude was vulnerable to losses on Monday with prices challenging $47 as Iraq’s ongoing quest to reclaiming market share dampened expectations over the possibility of September’s informal OPEC meeting concluding with a freeze deal. Oil’s weakness was complimented with Dollar’s resurgence from the renewed hopes over the Federal Reserve raising US interest rates in 2016. It is becoming increasingly clear that the explosive movements observed in oil were powered by sentiment rather than fundamentals which question the sustainability of the rally. Inflated expectations over OPEC securing a freeze deal enticed bullish investors to attack while oil price sensitivity intensified the speculative boosts in prices. Although the gains were undeniably impressive, WTI still remains fundamentally bearish with concerns over the excessive oversupply haunting investor attraction.
Saudi Arabia has already suggested that intervention in the markets may not be needed and such may have thrown a wrench into the clockworks. Although OPEC has skillfully exploited the oil price sensitivity to create explosive appreciations in oil this could come at a cost. The cartel remains notorious for holding meetings which conclude with investors left empty handed and if September follows the same pattern then WTI could be open to steep losses. From a technical standpoint, a strong breakdown below $46 could open a path towards $44.
The BoJ pressured to act
The Bank of Japan remains under pressure to act, as the combination of soft domestic data and a strengthening Yen amid risk aversion weigh heavily on the Japanese economy. Inflation continues to follow a negative path while global developments have exposed the nation to downside risks. Bank of Japan Governor Haruhiko Kuroda has pledged to boost monetary stimulus if needed, but with a history of under delivering monetary measures is the market listening?
The previous expectations of Helicopter money have been discounted with the central bank potentially funding infrastructure projects in a bid to jumpstart economic growth. With speculations still mounting over the BoJ easing monetary policy further in an attempt to regain economic stability, the Yen was open to losses on Monday. Overall, sentiment still remains bearish towards Japan with the Yen trapped in a fierce tug of war against risk aversion and optimism over the BoJ unleashing further monetary measures.
The USDJPY experienced a sharp incline last week with Dollar’s resurgence acting as a driving force. Prices are trading above the daily 20 SMA but the MACD still trades to the downside. A sharp breakout above 102.50 could encourage buyers to send the USDJPY towards 103.50.
The U.S Dollar surged on Friday following Yellen comments in Jackson Hole that the case for an interest rate hike in 2016 has strengthened.
The Greenback traded strongly higher across the board as the Dollar index added 0.84% at the time of the weekly close.
Yen retreated by 1.3% to 102 per dollar after FED chair fueled rate hike bets in 2016 while Bank Of Japan chief Kuroda said he is ready to add further stimulus measures if needed.
The Euro closed below 1.1200 handle, in the meantime, the British pound trimmed the majority of last week gains to stabilize at 1.3120 level.
As of the week ahead, investors will be looking at the U.K PMI, in addition to the GDP figures from Canada and the Australian retail sales, while the focus will be on the U.S Non-Farm payrolls on Friday.
The U.S Economy is expected to add 180 000 additional jobs in August slightly below the year-to-date average which stands at 186K. It is important to note that last month figures were robust and showed a job gains of 255 000. Meanwhile, any number above 150K will reinforce FED officials view that the economy has reached full employment, which may have a positive impact on the next rate hike decision and consequently another rally in the U.S Dollar remain possible.
Technicals:
Looking at the technical outlook of some major currency pairs for the week ahead.
EUR/USD
The Euro retreated on Friday as the Dollar strengthened across the board fueled by the rate hike bets from the U.S following Yellen comments in Jackson Hole.
Technically, the single currency turned bearish in the hourly chart after prices managed to break below 1.1240 support. Therefore, a continuation to the downside in the direction of 1.1160-1.1110 support zone remain possible during the week ahead before to see some demand in the pair. In the meantime, a retracement towards 1.1240/60 new resistance zone (former support) is likely to find strong sellers. In the daily chart, the trend remain bearish below 1.1365 (61.8% retracement from 1.1600 peak to 1.0900 low) and as far as prices keep trading below this level, the upside potential should be limited in the Euro.
Support: 1.1160-1.1110-1.1050
Resistance: 1.1240-1.1260-1.1330
GBP/USD
After the recent rally seen in cable, the pair traded lower by the end of last week on the back of US Dollar strength.
From a technical standpoint, the Sterling remain positive in the hourly chart as far as 1.3025 support is in place. Meanwhile, the focus shifted to 1.3072 level, which represents the 50% retracement of the entire recovery that began from 1.2865 support.
Therefore, a bounce can happen around this level in the coming days and another extension towards 1.3170 resistance is likely. In the opposite, if the pair trades higher in the beginning of this week, then we expect sellers to appear between 1.3170 and 1.3196 resistance levels.
Looking at the biggest picture, the trend remain bearish in the daily/weekly charts and as far as 1.3370 peak is intact, any rally should be short-lived in this pair.
Support: 1.3110-1.3072-1.3025
Resistance: 1.3170-1.3197-1.3230
[B]GOLD[/B]
After several attempts to break above 1357 hourly resistance that failed, prices succeeded to break below the support zone of $1333/1328 in the daily chart, which can clear the path to a re-test of 1310-1305 support zone in the next days.
Technically, gold turned bearish in the near-term as prices has shown four consecutive lower highs (1375-1367-1357-1342) from the yearly peak of $1375, which reinforces the probability of further weakness in the coming days. As of now, $1322 represents the short-term resistance level while the most important barrier stands at 1328 for the week ahead.
To summarize, gold remain under pressure and the upside potential is likely to be limited.
Support: 1315-1310-1305
Resistance: 1322-1328-1331
USD/JPY
The pair managed to preserve the psychological support of 100.00 and we have seen a big jump on Friday especially after the strong break above 100.93 resistance level.
Technically, prices showed an upside reaction each time the pair tried to break below 100.00 support as Bank of Japan officials continue to eye this level.
In the near-term, and when looking at momentum indicators, we can see that the pair has more potential to the upside. Therefore, another rally in the direction of 102.60/80 resistance zone cannot be ruled out.
In the flipside, a drop towards 101.50 level should give strong support to USD/JPY.
Meanwhile, when looking at the daily chart, the pair keep printing lower highs/ lower lows since 114.90 peak and consequently, the selling pressure is likely to resume after the current correction finds and end.
In extension, a daily close above 102.80 resistance should send prices to as high as 103.30/60 before to see new sellers.
Global stocks oscillated between losses and gains on Monday as investor anxiety triggered expectations to fluctuate over the Federal Reserve raising US interest rates in September. Although market participants were provided clarity last week when Yellen stated that the case for raising US rates had strengthened in recent months, September could be premature to act and investors may be digesting this reality. Asian stocks commenced Tuesday on a solid footing borrowing the upside momentum from Wall Street and could trade higher as optimism over the BoJ unleashing further monetary measures attract investors to riskier assets. In Europe, stocks were vulnerability to losses by the intensifying rate hike signals while Wall Street received a welcome boost from rising banking stocks. Stock markets may meander between losses and gains ahead of Friday’s NFP report which if exceeds expectations could provide a justifiable reason for the Fed to raise US rates in December.
Although the renewed rate hike hopes have somewhat elevated global sentiment and propelled stock markets higher, exhaustion is becoming visible and such should keep investors diligent. Fears over the global economy continue to linger in the background while uncertainty and depressed oil prices weigh heavily on investor risk sentiment. With central bank caution still a recurrent theme, the ingredients for a bear market are visible. It could take an unexpected catalyst to trigger a heavy selloff with bears on the prowl waiting for the opportunity to attack.
GBPUSD sinks below 1.3100
Sterling descended lower on Tuesday with the GBPUSD sinking below 1.3100 as the combination of Sterling vulnerability and Dollar resurgence from renewed rate hike hopes, enticed sellers to install repeated rounds of selling. It is becoming increasingly clear that Brexit has left the Sterling inherently pressured with the persistent uncertainty haunting investor attraction towards the currency. Sentiment remains firmly bearish towards the pound with further declines expected as expectations mount over the BoE cutting UK interest rates to near zero in a bid to reclaim economic stability. Sterling/Dollar remains fundamentally bearish and the divergence in monetary policy between the Fed and BoE could encourage a further decline back towards 1.2900. From a technical standpoint, prices are trading below the daily 20 SMA while the MACD has also crossed to the downside. Previous support around 1.3100 could transform into a dynamic resistance which opens a path towards 1.2900.
Commodity spotlight – Gold
Gold was searching for direction on Monday as expectations started to shift over the Fed raising US interest rates in September. This precious metal remains highly sensitive to US rate hike expectations and could meander between losses and gains ahead of Friday’s NFP. Although prices are already bearish on the daily timeframe, a positive NFP could be the catalyst needed for bears to conquer the firm $1315 support. From a technical standpoint, a breakdown below $1315 could open a path towards $1285.
The rising optimism over the Federal Reserve breaking the tradition of central bank caution by raising US interest rates in 2016 has inspired the Dollar bulls with the Dollar Index edging higher towards 96.00. Although expectations continue to fluctuate over the possibility of a US rate rise in September, the 54% probability that the central bank could act in December continues to make the Dollar attractive. Sentiment remains bullish towards the US economy with the string of positive domestic economic data releases providing a compelling reason for the Fed to raise US rates before year end. With the period of uncertainty dispelled from last week’s hawkish comments from Yellen, the Dollar could be set for further gains as bets intensify over the Fed hiking rates.
The main focus this week will be the monthly US Non-Farm payroll figures for August which if exceeds expectations could encourage more Fed members to join the hawkish camp. Dollar bulls were rampant last week and the momentum has trickled into the new week with the Dollar Index trading towards 96.00. From a technical standpoint, although prices are still in the boundaries of being bearish on the daily timeframe, a decisive breakout 96.00 could open a path towards 96.50.
Commodity spotlight – WTI Oil
WTI Oil was left vulnerable to losses on Monday as the combination of Dollar resurgence from renewed rate hike hopes and concerns over the excessive oversupply of oil in the global markets encouraged sellers to attack. The heightened expectations over OPEC securing a freeze deal in September’s informal meeting have been quelled by comments from Saudi Arabia and Iraq who continue to unleash record output into the markets. With the Dollar potentially strengthening further as rate hike speculations intensify, future speculative boosts in oil prices triggered by OPEC could be capped. August’s sharp rally which defied the fundamentals has already displayed signs of exhaustion, with the awful combination of oversupply fears and anxiety over demand waning ensures WTI remains depressed. All eyes will be on September’s informal meeting and if it concludes without a solid deal then Oil could be open to steep losses. From a technical standpoint, a strong breakdown below $46 could open a path towards $44.
Oil markets continue to drift lower on the charts as the USD strengthens on the back of recent hawkish comments from the FED and in the build up to non-farm payroll this week. With the market expectation likely to be for a strong reading as the labour market has continued to deliver in the wake of expectations it will weaken. There has been calls internally from OPEC to support a production cut and moments ago Iraqi Prime Minister Haider Al-Abdai was looking to support an oil output freeze in an effort to stabilize prices and stop oil sliding any further, as the financial stress continues to be an issue for OPEC nations and even Saudi Arabia which is burning through cash reserves. The only issue for this is that many nations including Saudi Arabia have done this to fight of other oil producing nations and establish OPEC as a dominant player, however so far supply has not fallen at all and continued to increase in some regards, especially with Iran looking to boost production to 4.75 million barrels from 3 million and Libya which is rebuilding production as well. So a freeze may be some time off, especially with how fical OPEC can be internally.
Oil on the charts has been very bearish as of late and I expect it to continue to stretch lower in the short term as the bears have complete control. The next level of major support can be found at 45.78 and the expectation is that it will likely continue to slide lower to this level. If there is no output freeze then I would anticipate further sliding to 44.58 as the next level of support; beyond this level I would struggle to see further major gains unless market conditions change rapidly.
The Australian dollar has been looking weaker against the bears as of late as it struggled to gain any sort of traction on the charts. Data earlier in the week was lacklustre, but the recent building approval data was strong with a rise of 11.6% on the back of a rush for apartment approvals helping to boost the numbers. This comes on the back of the previous months data which showed a decline of -4.7% which worried economists as interest rates were looking to shift lower. Despite the good result it's the USD strength which is driving markets at present, and the weak Australian economy has so far failed to find any sort of ground for future rate rises to encourage fixed interest traders.
On the charts the AUDUSD has been well and truly taken by the bears and is getting pushed through support at 0.7517 and the 38.2 fib retracement and testing the 100 moving average. A push through here will signal strong bullish momentum and we could see the AUDUSD slide lower to 0.7450 which is currently just below the 0.50 fib retracement level and likely to be the next major zone traders look to target. Either way while the USD continues to be the in-trade all eyes will be on the AUDUSD to see how much it can take before traders look to take some of those gains.
Dollar rally continue fueled by FED’s rate hike bets
The Dollar index ended little changed at 95.60 on Monday as investors awaits August Non-Farm payrolls due by the end of this week.
The Euro extended its losses and fell by -0.10% yesterday, the British pound edged lower and has lost -0.22% while the Japanese Yen plunged to reach 3-week high against the Dollar at 102.40 as rate hike bets increased significantly following Yellen recent Hawkish comments in Jackson Hole last Friday.
In equity markets, the DowJones closed 108points higher and S&P500 was up 0.5%. In the meantime, Gold managed to recover from 5-week low of $1315 per ounce while Oil prices retreated by nearly 2% on Monday to settle at $46.98 on surging OPEC output.
As of today, few economic releases were scheduled in the both the European and U.S trading sessions, however, we have seen some big movements in the FX market.
Beginning from Europe, German Import price index came out above expectations at 0.1% in July while it was anticipated at -0.1% only. In the meantime, inflation contracted in August as both the MoM and the YoY figures missed forecasts and registered 0.0% and 0.4% compared to estimates of 0.1% and 0.5% respectively.
In the U.K, mortgage approvals decreased to 60.9K down from 64.2K previously while the net consumer credit saw a deterioration in July as the figures showed a decrease by 1.2b against 1.9b in June.
In the U.S, the consumer confidence index jumped to 101.1 up from 96.7 previously and above estimates of 97.0
The U.S Dollar resumed its recovery today as the Dollar index added +0.40% at the time of this report to trade at 95.97 level, which is considered as a major resistance in the near-term. Therefore, traders should focus on prices reaction around the 96.00 handle to confirm the bullish reversal signal given on Friday.
Technically, a break above this resistance should expose 96.25/50 area in the coming days, and from where strong sellers may appear. From a larger perspective, the Dollar keep trading sideways in the weekly chart, as investors remain skeptical about the date of the next interest rates hike. Consequently, volatility can persist in the near-term unless we see a clear break above 97.65 peak or below 93.00 weekly support.
Meanwhile, we can see that bulls managed to preserve the higher lows structure that began from 92.95 low, which may lead to further gains in the Greenback especially if a daily close above 96.50 level happens.
Dollar bulls received ample encouragement on Tuesday following the impressive consumer confidence report which bolstered sentiment towards the US economy. The Consumer Confidence Index (CCI) for August lurched to its highest level in almost a year at 101.1 consequently reinforcing expectations over the Federal Reserve raising US rates in 2016. For an extended period, economic data from the States has repeatedly exceeded targets while the slightly easing concerns over the unstable global landscape continue to provide leeway for the Fed to take action. Clarity and direction on US rate hike timings were gifted to investors following Yellen’s hawkish speech last week and it has now become a matter of when rather than if rates will be increased.
Attention may be directed towards Wednesday’s ADP private sector payroll report which could offer further clarity on how the US labour force is faring in a period of global uncertainty. If the ADP follows a positive pattern and exceeds expectations, then the Dollar could surge higher as bets intensify over the Fed potentially pulling the trigger in December.
Dollar bulls are relentless and this may be displayed on the Dollar Index which has lurched towards 96.00. From a technical standpoint, prices are turning bullish on the daily timeframe and a decisive breakout above 96.00 could open a path towards 96.50.
Yen weakens on stimulus hopes
Bank of Japan Governor Haruhiko Kuroda’s pledge to boost monetary policy if needed has spurred expectations of the BoJ taking action in the future consequently weakening the Yen. The terrible cocktail of repeatedly soft domestic data and a strengthening Yen from risk aversion continues to weigh heavily on the Japanese economy and this has pressured the central bank considerably. Even though there is optimism over the BOJ taking further action, with its history of under delivering monetary measures, will investors be left empty handed once again? Previous speculations of Helicopter money have been quelled with talks of funding infrastructure projects as a method of jump-starting its ailing economy. Overall, sentiment remains firmly bearish towards Japan with the Yen potentially weakening further as bets mount over the BoJ taking action.
The combination of Dollar strength from renewed US rate hike expectations and Yen weakness from stimulus hopes has encouraged bulls to install heavy rounds of buying on the USDJPY. Although prices are currently respecting a bearish trend on the daily timeframe, a decisive breakout above 104.00 could spell trouble for the bears.
Commodity spotlight – WTI Oil
WTI Oil pierced below $46 on Wednesday as the concerns over the excessive oversupply of oil in the global markets haunted investor attraction towards the commodity. Fears are mounting that U.S crude stocks may have expanded further last week while optimism continues to diminish over OPEC securing a freeze deal agreement in September’s informal meeting. With Dollar strength becoming a dominant theme in the markets, WTI could be pressured further moving forward. The ingredients for a bear market are visible and the awful combination of oversupply concerns and faltering demand fears could encourage bears to send WTI Oil lower. From a technical standpoint, a strong breakdown below $46 could open a path towards $44.
The Australian dollar continues to be controlled by the bears as it looks set to close below the 38.2 fib retracement line, as a combination of a stronger USD based on increased betting in a FED rate hike and weakness in the Australian economy take its toll on the economy. However, the next 12 hours are likely to set a precedent for momentum for the AUDUSD as capex data is expected to be released and retail sales; in addition Chinese data is also out on Manufacturing with expectations it will show a minor contraction. Capex data and retail sales for me will be the big mover, as capex data will show overall investment internally from firms in the Australian economy and will be an indicator if firms are looking to increase that investment. Expectations are however low with a predicted reading of -4.2% q/q. Retail sales however are also expected to dip to 0.3% and this will have a large impact on the appetite for Aussie bulls if that is indeed the case.
Technically speaking it's very much a bearish trend for the AUDUSD as it continues to slip down the charts. Expectations are now building around the 50.0 fib level at present as it looks likely we will see the AUDUSD look to test this key level at 0.7450 as the bears look to take a big swipe out of the commodity currencies. It's possible that we will see a sharp pull back from this point up the charts to the 38.2 retracement level and then further bearish momentum back down the chart as traders look to take a breather and the possibility of rate hikes increase for the USD adding further fundamental pressure.
Oil markets jumped sharply into the red today as expected crude oil inventories showed a large build up of 2.28M barrels (0.92M exp). This is a slightly smaller increase than the previous week, however it's still a large build up and to add further fuel to the fire recent OPEC data showed production at record levels as they globally pumped 40K more barrels in August than July, putting total production at 33.50Mbpd. Output has so far been limited in Nigeria and Libya, but they have a large amount of production capacity and it is looking like only a matter of time before the pressure comes on them and they look to rapidly increase production. This in turn could put real pressure on oil bulls and the bears look likely to be in for a field day.
Market movements have so far been very much in favour of the bears with the H1 chart showing big swings on news out of OPEC and oil inventories. Expectations are now building that we will see oil look to push the key support area of 44.50 as the bears look to push oil lower. With the USD strengthening and production increasing it is creating a very bearish scenario for oil traders and even the technical's are showing strong signs that the bears are likely to stay in control for some time.
