Global macro overview for 26/01/2016:
Crude oil prices are in the spotlight again as they fell back below the $30 a barrel. The recent remarks from Kuwait and Iraq regarding the willingness to cut oil production in coordination with other non-OPEC countries did not help oil prices rise. There is still plenty of supply in the market; moreover, the Iraqi oil production hit a record in December as the output increased in the southern and central fields.
From the technical point of view, there is an interesting situation as oil prices might be forming a double-bottom pattern. The first leg of this pattern is already in place and now the lower channel line is being tested around the important psychological level of $30. The bearish engulfing pattern in the daily time frame must be confirmed by another daily downside candle to confirm this scenario. If it is successful, we might see another test of the low at the level of 26.16.