The price of crude oil has experienced a decline due to weak data in anticipation of the upcoming decisions by the Federal Reserve and the European Central Bank. The direction of West Texas Intermediate remains uncertain.
The crude oil market experienced a decline due to the release of Chinese data that did not meet expectations. For April, the manufacturing PMI was recorded at 49.2, falling short of the previously estimated 51.4 and 51.9 figures. Similarly, the non-manufacturing PMI was reported at 56.4 instead of the anticipated 57.0 and the preceding 58.2 value.
The WTI futures contract is worth around $76 per barrel and the Brent contract is a little under $80 per barrel.
The price of gold is currently trading at around US$ 1,980 per ounce, which is slightly lower.
The Japanese Yen continued to decline after the Bank of Japan reiterated its cautious approach and the Jibun Bank PMI showed a contraction in April. USD/JPY may rise above 136.
The expectation for an end to yield curve control has been delayed because the new Governor Ueda is hesitant to tighten due to China’s economic struggles and the US banking sector focusing on crisis management.
The Federal Deposit Insurance Corporation (FDIC) was anticipated to release a statement regarding First Republic Bank on Sunday evening in North America; however, it has not been issued as of the time of printing.
Although the PMI figures were weak, the majority of open equity markets in the Asia-Pacific region are performing well. Additionally, the Australian Dollar experienced slight growth before the upcoming rate decision by the Reserve Bank of Australia, which is anticipated to remain unchanged according to market expectations.
Several financial markets are closed today due to a holiday, however, there is a busy week ahead with central banks convening to determine monetary policies. The Federal Reserve and the European Central Bank are of particular importance.
CRUDE OIL (WTI) TECHNICAL ANALYSIS
WTI crude slid lower today after posting a solid gain on Friday. After being tested at 73.94, the 50% Fibonacci Retracement level of the movement from 64.36 to 83.53 resulted in a rally. It is possible that this level will continue to offer support prior to the breakpoints located at 72.25-72.46. Additionally, a nearby breakpoint at 75.72 may also provide support.
In terms of the academic context, it is suggested that the resistance level on the topside may be located at the recent high point of 79.18. Additionally, there exist a number of breakpoints and previous peaks in the range of 82.50 to 83.50 which may present a potential resistance zone.
