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Forex News April 08, 2022

by Seerat Fayaz   ·  April 8, 2022   ·  

Forex News April 08, 2022

by Seerat Fayaz   ·  April 8, 2022   ·  

#edgeforex #forextrading #forexsignals #forex #trading #oil #market #opec #china #prices #russia #ukraine #eu #cryptocurrency #bitcoin opec

Oil

  • Taking stock of the oil market outlook. WTI crude looks set to close below $100 this week, and the charts show a semblance of a double bottom just below the $94 mark.
  • This will be an important level to monitor before a possible drop towards $90 in the near future. Even if OPEC+ isn’t going to mess things up, recent sentiment hasn’t been kind to the oil market outlook. Let’s take an inventory of the situation.
  • China’s lockdowns, as well as geopolitical tensions, continue to threaten a further slowdown in the global economy. Rising inflationary pressures are also weighing on the consumption outlook.
  • Reserve releases by the US and the IEA have resulted in a narrowing of backwardation spreads, indicating less concern about the near-term availability of oil supply.
  • There are good reasons to expect a pullback, but the main point remains. That is, the first two factors will pass eventually, while the third is only a temporary fix. Reserve releases do not help to correct the oil market’s structural imbalances.
  • Oil prices will remain high unless there is a collapse in demand or a crash due to recession fears. If the latter scenario occurs, it would be an ideal time to buy on the dip. Otherwise, any further pullbacks will make it more appealing to scale into longs.
  • A push towards $90 may entice some buyers, but we will see stronger plays from oil bulls in securing longer-term positions around the levels of $80 to $85.

Russia

  • Russia claims that a’special operation’ in Ukraine could be completed in the ‘near future.’ Remarks from the Kremlin.
  • Aims are being met and work is being done by the military and peace negotiations
  • Russia remains adamant that everything is “on track” for them. However, this is the type of rhetoric to be expected from their side; otherwise, the alternative would be a sign of weakness.
  • The Bank of Russia reduces the key rate by 300 basis points to 17 percent from 20 percent following the emergency hike at the end of February.
  • The external environment for the Russian economy remains difficult; financial stability risks remain, but have abated for the time being; and the prospect of further key rate reductions in upcoming meetings remains.
  • The move comes as the ruble has made a remarkable recovery in recent weeks, returning to levels close to those seen before Russia’s invasion of Ukraine.

EU

  • EU formally adopts new sanctions against Russia, including a ban on coal imports.
  • This is the first time the EU has addressed Russian energy.
  • This has been expected since the beginning of the week, so it is nothing new. The entire announcement can be found here.
  • The coal import ban has been postponed until August 2022, as previously stated, but it is a start. It remains to be seen whether the EU will have the appetite to pursue oil and gas, but if so, Germany will undoubtedly be a major stumbling block once again.

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