OIL: Standard Chartered Takes a Completely Bearish Turn

• RES 4: 1.3175 High Oct 4 2024  
• RES 3: 1.3119 76.4% retracement of the Sep 26 ‘24 - Jan 13 bear leg
• RES 2: 1.3048 High Nov 6 ‘24
• RES 1: 1.3015 High Mar 20 and the bull trigger  
• PRICE: 1.2915 @ 15:51 BST Apr 1
• SUP 1: 1.2887/71 20-day EMA / Low Mar 27      
• SUP 2: 1.2759 50-day EMA and a short-term pivot support
• SUP 3: 1.2679 Low Mar 4   
• SUP 4: 1.2559 Low Feb 28      

GBPUSD is in consolidation mode and importantly for bulls, the pair continues to trade closer to its recent highs and above last week’s lows. MA studies are in a bull-mode position highlighting a dominant uptrend. Support at the 20-day EMA, at 1.2887, is intact. A breach of 1.3015, the Mar 20 high and bull trigger, would open 1.3048, the Nov 6 2024 high. A clear break of the 20-day EMA is required to instead signal scope for a deeper correction.                  

However, the pullback in the general activity indices of the 3 regional Fed services surveys points to a below-consensus ISM Services headline reading.

• The average of NY/Philadelphia/Dallas - which fell to the lowest levels since the onset of the Covid pandemic in 2020 - is consistent with an ISM services index of closer to 50.0 than the 52.9 consensus (53.5 February).
• Compared with a less obvious rise in the price indices across the 3 Feds, general activity indices pulled back sharply in March across the three regions: NY by 9 points, Philly by 19 points, and Dallas by 16 points.
• Notably the KC and Richmond Fed surveys also saw their composite indices decline - so this is a national story.

Following the publication of the NY/Philadelphia/Dallas Feds' regional services surveys for March, the picture that emerges is of much slower activity and worsening confidence, though inflationary pressures aren't noticeably climbing.

• ISM Services Prices Paid is seen ticking up to 62.9 in March in Thursday's report (1000ET), up 0.3 points from February.
• That seems like a fair estimate: the 3-regional Fed average rose to a 16-month high in March, after being basically flat for 3 months.
• That was largely due to a 13 point jump in the Philly Fed's current prices paid, and to a lesser extent a 7 point rise in the NY Fed's equivalent - whereas the Dallas Fed's measure was flat.
• And this appears to be catching up with prior gains in the ISM measure, rather than the other way around.