Two trades to watch: WTI, EUR/USD
Fiona Cincotta April 14, 2021 7:36 AM
WTI holds firm over $60 ahead of EIA stock pile data. EUR/USD trades at monthly high ahead of Lagarde & Powell.
WTI firm over $60, API data in focus
WTI is ticking higher following upbeat API data overnight which revealed a draw of -3.608 million barrels.
OPEC also raised its forecast for global oil demand growth in 2021 to 5.95 million bpd up from 5.89 million bpd.
US Dollar dropped to a 3 week low following upbeat US inflation data & a strong bond auction.
Rising covid cases in Europe & tighter lockdowns continue to haunt oil
EIA official inventory data is due later, expects -2.154 million draw versus -3.522 million prior.
Where next for WTI crude oil?
At the start of the week, WTI crude oil pushed above its descending trendline dating back to early March.
It also rose above its 20 & 50 EMA on the 4 hour chart.
The price had been trading within a tight range of 59.50 – 60.70 over the past 10 days with little directional strength.
At the time of writing the price is attempting to breakout above the upper band at 60.70. Beyond here the buyers could gain traction. The RSI is supportive of further gains.
Resistance can be seen a 62.15 March 29 high and the highest level seen since mid March.
On the flip side strong support can be seen at 60.00, the confluence of the 20 & 50 EMA. A break through this level could see 59.50 the lower band of the horizontal channel tested opening the door to the descending trendline support at 59.25 come into play. Beyond here 58.50 could also offer some support.
EUR/USD at monthly high, attention on Lagarde & Powell
EUR/USD is extending gains for a third straight session, trading at its highest level in a month.
The US Dollar hit a three week low on easing inflation fears, downbeat yields and vaccine concerns after US authorities call for a pause in the use of J&J’s covid vaccine.
ECB’ s Lagarde and Fed Powell are both due to speak later
Where next for EUR/USD?
EUR/USD has pushed back over its 200 day EMA and 50 day EMA which combined with a bullish MACD suggests that there is more room for further upside.
The pair has also broken above resistance at 1.1950 high March 24 and is looking towards 1.20 round number and high March 12. A move beyond here could see the buyers gain traction, eyeing a move towards 1.2130 the March high.
On the downside, immediate support can be seen at 50 EMA 1.1935 at move below here could negate the current uptrend. This could open the door to the key 200 EMA support at 1.1840.
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.