Article by ForexTime
Investors who were banking on OPEC to enforce some “extraordinary measures” to rebalance markets were left empty-handed on Thursday, after the cartel simply agreed on extending oil output cuts until the end of 2018.
Although short-term oil bulls were offered a slight boost following OPEC’s decision to extend production cuts by nine months, the overall muted market reaction verifies how this was already mostly priced in. There is even a suspicion that reports of both Nigeria and Libya agreeing to cap their production in 2018, were the main reasons why oil prices held steady following the meeting. While OPEC and Co. continue to cut production in an effort to boost prices, U.S. shale output has increased – with production rising 3% in September to 9.48 million barrels a day. It is becoming clear that oil prices will continue to remain exposed to downside risks, thanks to rising production of U.S. Shale scuppering OPEC’s efforts to rebalance markets.
Taking a look at the technical picture, WTI Crude still fulfills the prerequisites of a bullish trend on the daily charts as there have been consistently higher highs and higher lows. A breakout above $58.00 may encourage a further incline higher towards $59.00. Alternatively, sustained weakness under $56.75 could trigger a decline back towards $56.00.
Dollar jittery as U.S. tax vote stalls
The Dollar weakened against a basket of major currencies on Thursday, after U.S. Senate Republicans delayed voting on their tax bill as a setback forced them to make tweaks a few hours before a planned final vote.
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With the Greenback becoming extremely sensitive to any progress on U.S. tax reforms, there could be some action today depending on the outcome of the U.S. Senate’s vote on tax reform legislation. From a technical standpoint, the Dollar Index remains depressed on the daily charts. Bears remain in control below the 93.50 lower high with the next level of interest at 92.55.
Commodity spotlight – Gold
Gold was under pressure during Thursday’s trading session, with prices dipping towards $1270 as the risk-on sentiment and positive U.S. economic data reduced appetite for safe-haven assets.
Although the yellow metal has edged slightly higher today on the back of a weakening Dollar, bears remain in power below the $1280 resistance level. From a technical standpoint, sustained weakness below $1280 could trigger a further decline back towards $1267. Alternatively, a break above $1280, is likely to open a path back towards $1289.
Are Bitcoin bulls tired?
It has certainly been another explosively volatile trading week for Bitcoin which sprinted to a record high above $11400 on Wednesday.
I found it mind-boggling how the cryptocurrency entered a bear market by sharply depreciating towards $9000 after hitting record highs then back to a bull market in less than 24 hours – but with Bitcoin, we are seeing that anything is possible. With everyone’s favorite cryptocurrency having no intrinsic value and being inherently unstable, there are growing concerns over this just being another massive speculative bubble. While Bitcoin has on repeated occasions bounced back stronger amid criticism and negativity, the current price action suggests that bulls may be tired.
Taking a peek at the technical picture, the $10000 psychological level seems quite significant. A yearly close above this level could signal further upside; alternatively sustained weakness under $10000 may spark jitters resulting in a decline back towards $9000.
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Article by ForexTime
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