Oil Up Despite OPEC+ Surprise, Supported By Risk-On Sentiment
Jan-27 01:43By: Jack Lewis
Oil Bullets+ 1
- Oil futures are up around 1% on the day despite OPEC+ still planning to go ahead with the 400kbpd increase in January after conflicting reports in the build-up. The next meeting is set for Jan 4.
- Oil had fallen prior to this announcement and saw an immediate sharp drop before rallying back, supported by general risk-on sentiment upon the US opening.
- WTI is up 1% on the day at $66.25 but remains vulnerable. The Nov 26 breach of support at $74.76 (Nov 22 low) and the subsequent sharp sell-off confirmed a resumption of the downtrend and marked an extension of the current bearish sequence. Next support at $64.43 (Nov 30 low) with resistance at $72.93 (Nov 29 high).
- Brent is up 0.8% at $69.40 and also remains vulnerable. Attention is on $66.67 next (Aug 24 low) whilst initial firm resistance is seen at $74.35.
- USD risk tomorrow with non-farm payrolls, at which markets expect another 550k jobs added, knocking another 0.1ppts off the unemployment rate and with solid earnings growth.
- Against this backdrop, gold is unsurprisingly down -1% at $1764 and is closing in on the base of a bull channel at $1760.4, drawn off the Aug 9 low and an important support.
