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16 Nov 2016
By Ipek Ozkardeskaya
Oil rallies as downside risks prevail
The USJPY continues its journey north. A further yen depreciation could be expected with next critical target set at 110.00 level. Option positions are mixed between 108.50-109.50, supportive at 106.00 and above at today’s expiry. Intra-day supports are eyed at 107.40 (minor 23.6% retracement on Nov 9th to Nov 15th rise & 100-hour moving average), before 106.21 (major 38.2% retracement), max 105.15 (200-day moving average).
The GBPUSD retreated to 1.2379 and is expected to extend weakness to 1.2350 for weekly head-and-shoulders formation following Nov 11th peak at 1.2673. The daily MACD remains flat as trading volumes decline. Offers are touted above the 50-day moving average (1.2520). Light option offers stand at 1.2635. A break below 1.2350 should send the pair under one-month ascending channel base and signal a further bearish consolidation.
The AUDUSD remains under the globally improved yields’ pressure. Sellers are touted at 0.7517 and above (minor 23.6% retracement on Nov 8th to Nov 15th decline & 100-hour moving average), for a further extension of weakness toward 0.7440/0.7420 mid-term resistance. Decent option expiries trail above 0.7585 at today’s expiry and should keep any upside attempt limited through the day.
Gold oscillates around $1230. Large option expiry at $1250 could dent the upside momentum today, delaying a further recovery to $1241 (minor 23.6% retracement on Nov 9th to Nov 14th sell-off). Key support is presumed at $1223 (50-hour moving average) before $1210/1200.
The WTI took a lift to $46.65 amid Saudi and Russian ministers' pre-OPEC meeting revived hopes for action in Vienna. Nevertheless, the picture is getting more complicated with US protectionism, talks of possible reprise of sanctions against Iran, and a higher US production to rely less on OPEC production under Trump’s rule. All these factors are negative for the oil recovery. The US crude inventories data is due today. A larger than expected increase could dent the current appetite. Intra-day supports are eyed at $45.00/$44.90/$44.80, area including the minor 23.6% retracement on Oct 19th to Nov 9th fall, 200 and 100-hour moving average respectively. On the upside, resistance is eyed at 47.50 (50% level), before $48.60 (major 61.8% retrace).
The information and comments provided herein under no circumstances are to be considered an offer or solicitation to invest and nothing herein should be construed as investment advice. The information provided is believed to be accurate at the date the information is produced. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Please note that 71% of our retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing money.
