OIL: Oil End of Day Summary: WTI Down 3.5% on Week
WTI is down on the day and set for a 3.5% loss on the week over talk of a potential 28-point peace plan the US is trying to push forward on. Some of the losses were moderated after Bloomberg headlines that Ukraine and European allies reject key parts of US plan.
- WTI JAN 26 down 1.7% at 57.97$/bbl
- Baker Hughes US oil rig count: 419 (+2)
- The US push for a Russia-Ukraine peace deal is offsetting uncertainty over any supply disruptions caused by the start of the sanctions on Russian producers Rosneft and Lukoil.
- Zelenskiy said [regarding the 28-point peace plan] “this is one of the most difficult moments in our history. Ukraine faces a crucial decision: lose its dignity or risk losing a key partner." Says he will not betray Ukraine's national interest.
- Trump also said he would not pull off Russia oil sanctions. There was no anticipation a reversal was ever in play at this point.
- Russian Urals discounts in Indian ports have tripled since August due to Rosneft/Lukoil sanctions sources have told Reuters.
- US sanctions could leave nearly 48mbbl of Rosneft and Lukoil crude oil on tankers while seeking alternative destinations, Bloomberg said.
- The crude tanker orderbook has risen to a nine-year high, reaching 14.1pc of the existing fleet in October, according to Bimco, cited by Argus.
- Abu Dhabi conglomerate International Holding Company confirmed to Reuters on Friday it has expressed interest in Lukoil's foreign assets to the U.S Treasury.
- Iranian barrels are being relabelled as Indonesian oil with crude trans-shipped amid greater scrutiny of cargoes originating from Malaysia, Reuters said
- Near term crude options are currently the most bearish since mid-October after a surge in put volatilities this week.
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US TSYS: Tsys Buoyed Amid Ongoing Trade Tensions
- Treasuries look to finish modestly higher Wednesday, reversing midmorning losses after Reuters reported the Trump admin "is considering broad restrictions of exports to China made with US software, citing an unnamed US official and three people briefed by US authorities."
- No noticeable reaction in rates after late Bbg headline: "US TO ANNOUNCE 'PICK UP' IN RUSSIA SANCTIONS TODAY OR TOMORROW".
- Treasury futures gain slightly (TYZ5 113-24 +0.0) after $13B 20Y Bond auction re-open (912810UN6) stopped through - drawing a high yield of 4.506% vs 4.517% WI at the cutoff; 2.73x bid-to-cover vs. 2.74x prior.
- The Wall Street Journal reports citing sources that the ADP has stopped providing the Fed with weekly data on private payrolls and earnings. Per the WSJ piece, the Fed has had access to the data since "at least 2018", and was available to the Fed with "a roughly one-week delay". The publicly-available ADP payrolls report is published monthly.
- Equity earnings expected to release after the close include Southwest Airlines, Raymond James, Churchill Downs, Alcoa, Crown Castle, United Rental, Lam Research, Tesla and IBM.
- Thursday's weekly Jobless Claims & Chicago Fed data suspended.
AUDUSD TECHS: Potential Reversal Signal
- RES 4: 0.6726 1.236 proj of the Jun 23 - Jul 24 - Aug 21 price swing
- RES 3: 0.6660/6707 High Sep 18 / 17 and a bull trigger
- RES 2: 0.6629 High Sep 30 & Oct 01 and key short-term resistance
- RES 1: 0.6545 50-day EMA
- PRICE: 0.6505 @ 15:38 BST Oct 22
- SUP 1: 0.6440 Low Oct 14
- SUP 2: 0.6415 Low Aug 21 / 22 and a bear trigger
- SUP 3: 0.6373 Low Jun 23
- SUP 4: 0.6357 Low May 12
AUDUSD remains in consolidation mode. Price action on Oct 14 continues to highlight a possible reversal pattern - a hammer candle. It signals the end of the bear cycle that started Sep 17. Note that MA studies have remained in a bull-mode position during the latest bear leg, highlighting a dominant M/T uptrend. Initial resistance is 0.6545, the 50-day EMA. A breach of 0.6440, the Oct 14 low, would cancel the reversal pattern and reinstate a bear threat.
AUDUSD TECHS: Potential Reversal Signal
- RES 4: 0.6726 1.236 proj of the Jun 23 - Jul 24 - Aug 21 price swing
- RES 3: 0.6660/6707 High Sep 18 / 17 and a bull trigger
- RES 2: 0.6629 High Sep 30 & Oct 01 and key short-term resistance
- RES 1: 0.6545 50-day EMA
- PRICE: 0.6485 @ 15:46 BST Oct 22
- SUP 1: 0.6440 Low Oct 14
- SUP 2: 0.6415 Low Aug 21 / 22 and a bear trigger
- SUP 3: 0.6373 Low Jun 23
- SUP 4: 0.6357 Low May 12
AUDUSD remains in consolidation mode. Price action on Oct 14 continues to highlight a possible reversal pattern - a hammer candle. It signals the end of the bear cycle that started Sep 17. Note that MA studies have remained in a bull-mode position during the latest bear leg, highlighting a dominant M/T uptrend. Initial resistance is 0.6545, the 50-day EMA. A breach of 0.6440, the Oct 14 low, would cancel the reversal pattern and reinstate a bear threat.
