Market Analysis

Oil markets continue to trade higher

OIL

Oil markets continue to trade higher, close to the strong psychological level of $70, as prices remain supported by two major bullish leverages on the very short-term basis. The US Dollar continued to drop over the past two weeks and has strongly contributed to lifting oil markets higher, as well as the rest of commodity markets. Additionally demand for oil is surging as recovery and reopening hopes are sparking bets that economies will need more and more supply. Technically speaking, crude prices are trading close to the upper band of a bullish flag pattern, while the RSI has already broken-out of its bearish trendline, now evolving back above the crucial 50% level. Even if price directionality is decreasing, the DMI indicator confirms the bullish scenario by showing a vanishing bearish pressure on the market.

Pierre Veyret– Technical analyst, ActivTrades

 

 

EUROPEAN SHARES 
European benchmarks opened flat on the last trading session of the week, following declines in Asia, while US Futures still trade near record highs. Bullish scenarios remain valid on most indices, but today’s decreasing market volatility suggest investors are bracing for the highly anticipated US NFP release later. Market operators, seeking more economic clarity in the near-term, are likely to stay cautious before the August US job report, as many don’t want to take significant trading decisions without some clarity on the tapering roadmap from the Fed. Today’s jobs figure is expected to show a more modest increase than the previous months (+725K jobs), which could delay the start of a less expansive monetary policy from the Fed and drive stock prices further up.

Pierre Veyret– Technical analyst, ActivTrades

 

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