Oil markets have been volatile in 2017 and not the one way traffic we saw in 2016. The market has been responding to a variety of factors, the main one being the glut in oil caused by US fracking and thus far it has responded accordingly, with OPEC pushing down production to balance out prices in the market. It's easy to say that in this world we are seeing a push for renewable and green energy, but at the same time oil is unlikely to vanish for at the very least a few decades as it forms the life blood of the global economy.  But at present we have seen a slowdown in that volatility and a lot of stability, one thing is certainly clear in that it can't last! Oil figures today showed another draw down of -5.73M (-3.25M exp), this figure continues to show constant draw downs which will start to put pressure on oil prices in the long run. Market analysts are now calling for 60 dollars a barrel come 2018 and the potential to go higher if OPEC continues to maintain its production cuts. I am also starting to side with the bulls on this one, as draw downs continue to be more frequent, but it will take some time to eat through all the supply that has built up.

Oil on the charts is currently sitting above support at 52.10, but not looking too active at present. The recent daily volatility has shown no direction but the momentum behind it is bullish and the market seems poised to move. If we can see a push away from this battle and the bulls take back control then I would anticipate resistance at 53.70 being the main target of resistance for traders. If the bears do come flooding back into the market on surplus fears then support at 50.21 and 48.73 are likely to be prime targets. One this is also clear is that the market will use the current channel when moving side to side so expect to see sharp jumps when pushed from the bears or the bulls.

The other major oil player in the market is of course the Canadian dollar which is currently coming under pressure over the whole NAFTA arrangement as the US wants to change it or tear it up all together. With oil stagnating and the USD strengthening it's clear to see that the CAD's run may have come to an end in the short term and we could see some bullish movements. The only saving grace has been today's manufacturing data for the Canadian economy which showed a jump to 1.6% (-0.3% exp), a positive for a change.

With the USDCAD dipping today it has been pushed back by the 20 day moving average which is acting as support. Additionally support is likely to be quite strong at 1.2429 and 1.2219 on the charts with the bears going to struggle to take total control against a USD which seems to be stabilising. On the flip side resistance at 1.2553 and 1.2759 are likely to be strong candidates to slow down any massive moves higher, but act as key targets for traders. 

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