crudeoil markets continue to recover from recent selloff
market rallied, breaking above the $70 level. However, this uptick may just be a temporary bounce from a bear market oversold condition. It's likely that signs of exhaustion will appear soon, and oil prices may drop even further. After all, there is a ton of previous trading action just above, and typically “market memory” will come into the picture and make this difficult to overcome., which sits just above the $75 level. The market has been consolidating between $80 on the upside and $72.
As energy is a key factor in global growth, this market will be sensitive to any changes in the economic outlook. As the global economy slows down, typically you will see a lot less demand, as traders have been pricing into the market for some time.The $70 level had previously served as a hard floor, but as we approach the $77.50 area, which is the bottom of the overall range, we may encounter some market memory that could act as a barrier.To consider buying, we would need to break above the 50-Day EMA, currently near $81.55. However, that doesn't seem very likely.
Because of this, traders will have to pay close attention to the US Dollar Index, and of course, comments coming out of central banks around the world. Earlier today, the Norwegian central bank hiked rates again, and several other central banks around the world are likely to do so as well. This should slow down economic growth, which of course should keep oil stagnant to negative.
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