OIL PRODUCTS: Nigeria’s Kaduna Refinery to Re-open in 2024
Nigeria is planning to reopen its Kaduna refinery in Q4 2024, after being shut since 2018, according to Reuters citing a junior petroleum minister.
- Nigeria’s ambition is to initially produce 60k b/d from the 110k b/d capacity refinery.
- Nigeria is suffering from a lack of refining capacity, forcing it reliant on imports of refined produces.
- Nigeria is also looking to upgrade its Port Harcourt and Warri Refineries. Nigeria’s three state-owned refineries have a combined capacity of 445k b/d.
- Elsewhere in Nigeria’s refining sector, several small-scale refinery expansions were announced Oct. 25 at the OTL conference in Lagos, according to ArgusMedia, as Nigeria looks to expand its shortage in refining capacity.
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USDCAD TECHS: Bear Trend Conditions Remain Intact
- RES 4: 1.3805 High Mar 24
- RES 3: 1.3705 Trendline resistance drawn from the Oct 13 2022 high
- RES 2: 1.3593/95 High Sep 12 / 7 and key resistance
- RES 1: 1.3543 High Sep 27
- PRICE: 1.3527 @ 15:53 BST Sep 29
- SUP 1: 1.3417/3381 Low Sep 29 / 19
- SUP 2: 1.3323 61.8% retracement of the Jul 14 - Sep 7 bull leg
- SUP 3: 1.3266 Low Aug 2
- SUP 4: 1.3235 76.4% retracement of the Jul 14 - Sep 7 bull leg
USDCAD remains in a corrective cycle. The short-term outlook is unchanged and a downtrend remains intact - the recent breach of 1.3490, the Sep 1 low, and the move below the 50-day EMA, reinforced a bearish theme. A resumption of weakness would open 1.3323 next, a Fibonacci retracement. Next resistance to watch is 1.3593, the Sep 12 high. Key resistance is at 1.3695, the Sep 7 high.
US TSYS: Tsys Don't Fear the Shutdown, Nor Quarter End For That Matter
- Support for Treasury futures continued to ebb in the second half, bonds steady briefly before climbing again on quarter/month end positioning. Tsys started to consolidate late morning - largely knock-on effect as EGB's pared gains ahead the weekend. Moves not related to impending US Govt shutdown expected to start Sunday.
- Current Dec'23 10Y futures +6 at 108-01.5 vs. 107-26 low, well above initial technical support of 107-05+ 1.382 proj of the Jul 18 - Aug 4 - Aug 10 price swing. Dec'23 30Y futures tapped steady after the bell but rebounded +7 to 113-23 on quarter/month-end extension trade.
- Curves steeper with the short end outperforming, 3m10Y +1.687 at -87.756, 2Y10Y +2.326 at -46.222.
- Treasury futures had extended highs following a raft of in-line data this morning that pointed to cooling inflation metrics heading into the fall.
- Fast two-way trade reported after initial data came out largely in-line:
- Personal Income (0.4% vs. 0.4% est)
- Personal Spending (0.4% vs. 0.5% est, prior up-revised to 0.09%)
- Real Personal Spending (0.1% vs. 0.0% est)
- PCE Deflator MoM (0.4% vs. 0.5% est), YoY (3.5% vs. 3.5% est)
- PCE Core Deflator MoM (0.1% vs. 0.2% est), YoY (3.9% vs. 3.9% est)
- Little observable reaction to lower than est. Chicago PMI (44.1 vs. 47.6 est, 48.7 prior) and after slightly higher UofM consumer sentiment at 68.1 vs. 67.7 est, 1- and 5Y inflation expectations in-line with expectations of 3.2% and 2.8% respectively.
AUDUSD TECHS: Key Resistance Remains Intact
- RES 4: 0.6630 High Aug 2
- RES 3: 0.6616 High Aug 16
- RES 2: 0.6522 High Aug 30 and Sep 1, and the key resistance
- RES 1: 0.6501/6487 High Sep29 / 50-day EMA
- PRICE: 0.6460 @ 15:49 BST Sep 29
- SUP 1: 0.6331 Low Sep 27 and the bear trigger
- SUP 2: 0.6287 2.00 proj of the Jun 16 - Jun 29 - Jul 13 price swing
- SUP 3: 0.6272 Low Nov 3 2022 and a key support
- SUP 4: 0.6215 2.236 proj of the Jun 16 - Jun 29 - Jul 13 price swing
AUDUSD reversed course Thursday and the pair traded firmer again Friday. For now, short-term gains are considered corrective and the trend condition remains bearish. This week’s break of support at 0.6365, the Aug 17 low, highlights a resumption of the downtrend and opens 0.6287 next, a Fibonacci projection point. On the upside, key short-term trend resistance to watch is 0.6522, the Aug 30 and Sep 1 high. A break of this level would be bullish.
