Oil extended gains despite a stronger dollar. Although there is an inverse correlation between the greenback and all other instruments, this has not been the case with oil prices lately. The reason is quite simple.
The point is that Saudi Arabia and Russia do not intend to boost production. On the contrary, they have agreed to extend output cuts. This in turn raises fears of possible oil shortages. However, oil is extremely overbought, and the market needs at least some kind of downward correction.
Thus, oil prices continue to rise, which creates the risk of a sharp and sudden drop, thus provoking panic. The longer this rally continues, the greater the subsequent correction will be.
Even though the market saw a short-term pullback yesterday, it ended with a surge in the volume of long positions. As a result, the asset advanced to the level of $94.50 per barrel on prevailing optimism among speculators. Given the lack of a full-fledged correction and technical overbought signals ignored by traders, the current upward movement can be viewed as inertial. If the uptrend persists, the quote could climb to the psychological level of $100. Nevertheless, sooner or later market participants will begin locking in profits, which could lead to a steep fall in oil prices.
Gold was expected to fall just below 1,900 dollars per ounce. However, once the European Central Bank hinted that it was done with its protracted campaign of rate hikes, gold jumped to 1,920 dollars per ounce. The market situation is likely to remain positive until the upcoming meeting of the US central bank. The yellow metal has a chance of extending gains. Locally, gold prices may recover to the level of 1,950 dollars per ounce.
The ruble continued to lose ground yesterday despite the Bank of Russia's currency interventions. This was partly due to a stronger dollar across the board. For the most part, this can be attributed to the fact that the volume of interventions is not so impressive to seriously affect the situation.
Notably, technical analysis takes a back seat as the market is now focused on fundamental factors, including expectations regarding the upcoming meeting of Russia’s central bank.
Representatives of the banking sector have almost convinced everyone that the Bank of Russia will leave interest rates unchanged. However, the regulator may well jack up its key rate to 13.0% from 12.0% to step up support for the ruble. Given that such a decision is contrary to market expectations, it may help the Russian currency recover.
Meanwhile, the stock market fell below 3,100 in anticipation of the upcoming interest rate hike. Currently, the market is just above this mark, but expectations of further monetary policy tightening make it less attractive than bank deposits. Against this background, the index may shortly fix below 3,100 points.
That's all for now. We continue to follow developments in the financial markets. Subscribe to our channel and follow the news with us. See you soon!

00:00 Introduction
00:18 Situation on the oil market.
00:40 Brent
01:45 Gold
02:23 USD/RUB
02:59 To be or not to be? Raising the Central Bank rate?
03:24 Russian stock market
03:51 Conclusion

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