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Daily Market Report on Feb 24 2016
Crude price fell steeply to close below $32 per barrel yesterday after comments from ministers of OPEC member countries raised concerns that last week’s unprecedented proposal in Doha might not come to fruition.
In an attempt to guide the oil price back to its peak, at a meeting last Tuesday, Saudi Arabia and three other OPEC members had a historic deal with Russia to freeze their crude oil output at January levels.
However, the cooperation seemed to come to an end as Iran, that has just been liberated from sanctions and is planning to boost output by 1 million barrels per day, said the deal was an “unrealistic demand”, while Saudi Arabia announced that the kingdom would not cut its output because it did not trust other produces to follow.
Oil’s slump, not to mention concerns about growth in China and uncertain destiny of the U.K in the EU, has pushed global stocks into new falls. Asian equities followed the footstep of the U.S session when major indexes such as MSCI Asia Pacific Index, Australia’s S&P/ASX 200 Index, Japan's Topix and Hong Kong’s Hang Seng Index retreated.
Today, at 03:30 GMT, U.S Energy Information Administration is due to report the change in the number of barrels of crude oil held in inventory by commercial firms during the past week. The reading is forecast to lower to 2 million barrels in the week ending on Feb 19.
The pressure from U.K officials, who do not share the same view when it comes to the membership of Britain in the EU, is still weighing on the Pound today.
Fig: GBPUSD D1 Technical Chart
The pair traded at $1.39279 at 09:50 A.M GMT, down nearly 3,000 points from the start of the week. The price has been moving under the SMA 200 line since December 14 and seems to keep up its retreat, as the ADX (14), which is currently at 35.92, shows that the slide has been confirmed.
However, the RSI (14) is about to enter the oversold zone. A reversal is expected then.
Buy Digital Call Option at 1.400 and Digital Put Option at 1.3969
Fig: EURUSD D1 Technical Chart
The Euro is extending its sluggishness as it has been falling in the last 8 out of 9 candles against the greenback. The pair has already broken through the 61.8 Fibonacci retracement and is moving toward the MA 50.
The slide is gradually being confirmed as the ADX inches up to 32.81 with the –DI above the +DI.
Buy Digital Call Option at 1.1044 and Digital Put Option at 1.1002
Fig: EURCHF D1 Technical Chart
After plunging about 1,031 points and consecutively breaking through 50.0 and 61.8 Fibonacci support in the previous trading session, the currency keeps dipping deeper below the 61.8 level.
The price cut MA200 and inched slightly lower to 1.09033 at 10:00 A.M GMT.
The RSI (14) ticks down to 37.26, which indicates that the bear is dominating.
Buy Digital Call Option at 1.0955 and Digital Put Option at 1.0912
Fig: GOLD D1 Technical Chart
The precious metal seems to be having a correction today after rising 1.45% in the previous trading session. Since hitting the one-year high of 1263.37, gold has moved sideways around the 23.6 Fibonacci retracement.
Parabolic SAR indicator, is moving above the price.
The RSI (14), which is currently at 64.37, still hovers near the 70 threshold.
Buy Digital Put Option at 1212.51 and Digital Call Option at 1237.77
Fig: COPPER D1 Technical Chart
Although the metal has been in an uptrend in general, Copper’s retreat is on track, down more than 300 pips. The price is forecast to test the support at $2.0300.
The slump in commodity price is confirmed as the ADX is at 29.86 with the –DI is above the +DI.
Buy Digital Put Option at 1.0630 and Digital Call Option at 2.0740
Fig: DAX D1 Technical Chart
The German index has been in a downtrend for almost 2 months. Yesterday, the gauge broke back after hitting the resistance at 9536.18. The price is moving downwards and is about to cut the MA 14, which cut the MA 21 at the start of the Asian session.
The RSI (14) has lowered to 43.49, indicating the bear is coming in.
Buy Digital Put Option at 9259.7 and Digital Call Option at 9460.4