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    Oil intermarket: DXY rallying towards 95 keeping lid on the barrels mounting up Ross J Burland

    Oil has continued its decline below the $47 handle while the DXY has picked up to a touch from 95, despite longer-term yields continuing to fall to 2.43 in US 30 years within a supply glut and during heavy downside in the S&P 500.The US data was kinder to the US dollar overnight and that also boosted shorter term yield as markets score that up against a Fed rate hike at some stage later in the year with the Fed's fund rate contract rallying from 149 to 152 this week alone as an additonal supportive factor for the dollar.The focus stays with uncertainties and that is also supporting the world's reserve currency. "As demand for safe haven assets increases, commodities should remain under pressure," explained analysts at ANZ who also noted that the API data, explaining that a possible rise in oil inventories in the US may also place added pressure on oil prices. FOMC meeting: between a rock and a hard placeHowever, with the Fed's announcements coming up, should there be a dovish rhetori, despite a bullish outlook for the economy, perhaps writing off the recent jobs disappointments, we could see some support come in the stocks and commodities while markets re-position their risk from off to on again, supportive of a comeback in the black gold targetting $50.00.On the other hand, while the Fed is not expected to raise rates, but could signal rate hikes being appropriate in the near future, an extension of the dollar's rally and oil's decline could see a test of $46.71 WTI, 18th May lows and 28th April highs on a break of the 200 sma on the 4hr sticks at $47.68.Brexit: a timely excuse for the Fed for the rest of 2016?


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