Oil Spikes Higher, Commodity Linked Currencies on Demand

Nikolas Papas

Nikolas has been involved in the finance industry for over fifteen years spanning across Europe and USA with a depth of knowledge and experience within many aspects of the financial markets. Nikolas gained several years experience with some of the Europe’s leading Brokers, as equity analyst, and trader managing accounts for both Private and Corporate Investors. He enjoys both the fundamental and technical aspects of trading focusing on stock markets and all FX majors. Currently Nikolas provides analysis and comments to online financial publications. Educational background in Economics (BSc), and Finance (MSc).

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Oil Spikes Higher, Commodity Linked Currencies on Demand

September 17, 2019

Asian indices finished lower today after the oil price spikes over 10% as the drone attack in Saudi Arabia oil facilities will cut 5% of the world’s oil supply. The Hang Seng trading 0.96 per cent lower at 27,091, the Shanghai Composite trading 0.02 per cent lower to 3,030, while in Singapore the FTSE Straits Times index finished 0.15 per cent lower at 3,207. The ASX 200 in Australia is trading 0.06% higher at 6,673.

European indices are trading lower today, DAX30 is 0.53 per cent lower to 12,402, CAC40 is 0.61 per cent lower at 5,621 while the FTSE MIB in Milan is 0.68 per cent lower at 22,027. In London, FTSE 100 is trading 0.23% lower at 7,351. The UK is scheduled to leave the EU on October 31.

In commodities markets, crude oil trades 7.69 per cent higher at $59.07 after the drone strikes in Saudi Arabia oil facilities. Brent oil is trading 8.60% higher at $65,40 per barrel as oil world supply will be affected by the drone attacks. Gold trades higher at 1,503 keeping the bullish momentum as the price holds above all the major daily moving averages. On the upside, strong resistance will be met at 1,555.13 recent high while support is at 1,474 the 50-day moving average.      

In cryptocurrencies, Bitcoin (BTCUSD) is trading higher at 10,299, hitting the daily low at 10,195 and the daily high at 10,368. Bitcoin short term momentum is neutral now as it trades above the 100-day moving average and below the 50-day moving average. Immediate support for BTC stands now at $9,258 the low from August 29, while next support stands at 9,000. On the upside, strong resistance now stands at 12,315 the high from August 6th, and then at 13,500 round figure. Ethereum (ETHUSD) trades higher at 193,22 with capitalization now to 20.9 billion, on the upside, the immediate resistance stands at 317 high while the support stands at 136 the low from May 6th, Litecoin (LTCUSD) trades higher at 70.91. The crypto market cap now stands above $267.7 billion.

On the Lookout: The central bank of China set the Yuan rate (USDCNY) at 7.0657 versus yesterday fix at 7.0843.

China Industrial Production (year over year) came in at 4.4% below expectations of 5.2% in August. China Retail Sales (year over year) came in at 7.5%, also below market consensus of 7.9% in August.

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AUDUSD Daily Chart

Trading Perspective: In forex markets, USD index trades 0.44 per cent higher at 98.29, the Aussie dollar trades 0.03 per cent higher at 0.6882, while Kiwi trades 0.16% higher at 0.6387.

GBPUSD trades 0.43% lower at 1.2441 as we are getting closer to Brexit deadline. Major support now stands at 1.2078 recent low which if broken might accelerate the slide further towards 1.20. On the upside, immediate resistance now stands at 1.2513 the 100-day moving average, while more offers will emerge at 1.2738 the 200-day moving average.

In Pound futures markets, open interest decreased by 4.100 contracts, volume drop by around 139.500 futures contracts.

EURUSD trades 0.09% lower at 1.1061, after the crude oil spike. Immediate resistance for the pair stands at 1.1126, the 50-day moving average, and then at 1.1181, the 100-day moving average. On the downside, immediate support stands at 1.1057 today’s low and then at 1.0925 YTD low.

USDJPY is trading 0.32% lower at 107.71 having hit the daily low at 107.49 and the daily high at 107.92. USDJPY pair will find support at 104.44 the low from August 23rd. On the upside, immediate resistance for the pair now stands at 109.47 the 200-day moving average and then at 112.39 the high from April 2019. 

In Yen futures markets, open interest increased by 2.700 contracts, volume dropped by around 121.100 futures contracts.

USDCAD is trading 0.20 lower at 1.3258, the pair will find immediate support at 1.3017 the YTD low while extra support stands at 1.30 round figure. On the upside, immediate resistance now stands at the 1.3356, the high from September 3rd, before an attempt to 1.3450, the high from 31st May.  

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USDCAD Daily Chart

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