Facebook
 
 

18.02.2021: Long positions on USD stay relevant (Brent, USD/RUB).

loader
views
Oil has once again reached a peak. The continued rally in the oil market may send Brent quotes above 65 dollars a barrel. The bullish trend will lose its steam as soon as the weather improves in the US. Meanwhile, the ruble shows little reaction to rising oil prices. Extreme weather conditions in the US gave a boost to oil quotes. The situation remains tense. According to some reports, more than 40% of US crude production has been shut down, while the official data says the disruption to oil output is less serious. This factor keeps pushing the prices higher. Thus, Brent has reached the level of 65 dollars per barrel. Most probably, the price will develop an upside momentum to hit the mark of 67 dollars a barrel. The rally may continue until the weather in Texas changes. By the end of the week, the bulls may slow down their activity. A rare cold storm in Texas is not the only reason to drive the energy market. The OPEC+ deal and expectations of the US economic stimulus also support the prices. In addition, industry data on oil inventories in the US added to the market optimism. According to the API, US crude oil stock fell sharply by 5.8 million barrels which is twice the estimated decline. Today, traders will focus on the data from the Energy Information Administration. In general, a sudden surge in oil prices has a speculative nature. Actually, such a deep drop in oil inventories should have spurred outstripping growth of US oil, but this is not the case. At the moment, WTI crude is trading at 61 dollars 50 cents per barrel. The spread between the two benchmarks is still more than 3 US dollars. The short term disruption to oil production in the US and Brent holding close to 65 dollars a barrel means that traders should be cautious about further uptrend. Experts have already stressed that the market is overbought. So, it is better to pay attention to any signs of a trend reversal. The OPEC+ will hold its meeting at the beginning of March. It is very likely that major oil producers may consider ramping up the output amid a rise in oil prices. Saudi Arabia may hesitate to keep its voluntary cuts in April. And such countries as Nigeria and Iraq, that traditionally fail to comply with the output restrictions, may start to violate the terms of the deal even now. The oil’s rally is definitely a positive factor for the Russian market and the ruble. It has made several attempts to advance against the US dollar on higher oil prices. However, they were not successful, as the greenback does not give up its positions. The idea that an uptrend in oil has a short-term nature may limit the optimism of the ruble bulls. That is why it is worth paying attention to the dynamics of US stock futures rather than oil. The market sentiment is mixed today, and the overall situation seems uncertain. The ruble currently has no internal reasons for growth. Besides, traders may start taking profit аt any moment if any negative factors emerge. The dollar/ruble pair is trading near the level from the previous close at 73.8. A short-term downside momentum is also possible. In the coming sessions, the ruble may get support from the tax payment period in Russia. Meanwhile, the level of 73 serves as strong resistance. On Thursday, the dollar/ruble pair is expected to trade within the range of 73 and 74.
The balance of payments in Russia continues to worsen, while the rally in oil will not last long. Therefore, traders prefer to open long positions on the US dollar.

https://www.instaforex.com

FX Analytics - https://www.instaforex.com/forex_analytics
Forex Calendar - https://www.instaforex.com/forex_calendar
Forex TV from InstaForex - https://www.instaforex.com/instaforex_tv

Forex charts - https://www.instaforex.com/charts
Instant account opening - https://www.instaforex.com/fast_open_live_account
Forex Trading Contests - https://www.instaforex.com/forex_contests

List of official InstaForex blogs:
https://www.facebook.com/instaforex
https://www.instagram.com/instaforex/
https://twitter.com/InstaForex

#commodity_market #oil #instaforex_tv
← back to video list

InstaForex TV Calendar

InstaForex TV Calendar

InstaForex TV Interview

InstaForex TV Interview

Geography with InstaForex

Geography with InstaForex

InstaForex TV Events

InstaForex TV Events

Can't speak right now?
Ask your question in the chat.