Crude Oil Prices Hit $74 ahead of OPEC+ Meeting
Crude oil prices are trading at fresh two-and-half year highs during Monday’s APAC mid-day session, riding the tailwinds of US fiscal stimulus, falling inventories and an OPEC+ plan to further raise output in August. The oil cartel and its alliance will hold a meeting on July 1st, in which they may decide to lift pandemic-era production curbs to meet pent-up demand for fuel.
According to a Bloomberg survey, OPEC+ may boost output by 550k barrels a day in August. This amount marks less than a quarter of the global supply shortfall of 3 million barrels a day, according to Goldman Sachs’ estimation. Therefore, tight market conditions may warrant a slow and gradual output increase without causing significant price volatility.
Technically, WTI breached above a key chart resistance of 73.50 and opened the door for further upside potential. The next resistance can be found at around $76.50 – the previous high seen in 2018. The overall trend remains bullish-biased as suggested by the upward sloped SMA lines. The Relative Strength Index (RSI) pierced above the 70 mark, suggesting that prices may be temporarily overbought and vulnerable to a technical pullback.
WTI Crude Oil Price – Daily Chart
Bitcoin sticks with yet another defense of $30,000 for now.
The weekend brought about some nerves as price dipped to a low of $30,173 but once again, buyers kept a defense of the key psychological level at $30,000 – at least for now.
As much as the bounce may look impressive, it is once again not anything significant when looking at the technical picture for Bitcoin.
Price action is still largely consolidating around $30,000 to $40,000 with the latter level still keeping a lid on things alongside the 200- day moving average (blue line).
Unless buyers can hold a firm break of those levels, there is still much reason to be cautious about any bounce in the interim.
On the flipside, a daily break below $30,000 would pretty much open up the next leg lower in Bitcoin and the drop that follows is likely to be a rather sharp one
Bitcoin up 7% to near $35,000 currently
Daily U.S. Session Watchlist: NZD/USD
The Fed’s preferred inflation measure is up for release soon, so will the dollar resume its rally on another pickup in price pressures?
If so, this neat area of interest on NZD/USD might hold as resistance.
Uncle Sam is scheduled to print a fresh reading for the core PCE price index, which is said to be the central bank’s preferred inflation measure.
Keep in mind that market watchers are paying extra close attention to U.S. inflation data, as this could determine whether or not the Fed is getting closer to tapering.
Analysts are predicting slightly weaker price pressures at 0.6% for May versus the earlier 0.7% gain, but an upside surprise might still be enough to revive hawkish policy vibes.
If that’s the case, NZD/USD could find sellers at the strong area of interest visible on the 1-hour time frame.
The pair has formed lower highs connected by a falling trend line, which happens to be close to the 61.8% Fibonacci retracement level. Holding as a ceiling could send the price back to the swing low at .6922 or lower.
What to Watch: NZD/USD
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