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Fresh Shipping
Crude prices are sitting just below Friday’s highs as we start the new week. Indeed, we’re seeing some light selling across the European morning on Monday, despite news of fresh attacks on shipping routes in the Middle East. The UKMTO noted that it received reports overnight of a UK registered ship being hit by missiles in Gulf of Aden. The ship, which had to be abandoned by its crew, is now at risk of sinking. The attack is the latest in a strong of similar attacks on commercial liners in the region. Despite the news, however, oil prices have remained muted today suggesting that focus lies elsewhere currently.
US Data on Watch
A sharp downturn in US retail sales, reported last week, is potentially causing some uncertainty. US data has remained surprisingly robust over recent months, despite many calls over Q3/24 last year for an early 2024 downturn. However, with last week’s data offering the first signs of weakness in the US economy, there is likely some early trepidation regarding the potential that such a downturn still occurs this year. Indeed, coupled with hotter-than-forecast US inflation reported last week also, this view is causing oil bulls some pause for thought. Looking ahead this week, traders will be paying close attention to the FOMC minutes as well as the latest round of US PMIs. Any further signs of weakness will no doubt weigh heavier on oil prices near-term.
Technical Views
Crude
The rally in crude prices has stalled for now into a test of the 77.64 resistance level. With momentum studies bullish, however, focus is on a continuation higher and a fresh challenge of the bull channel highs and 82.59 resistance next. To the downside, 72.61 and the bull channel lows remain the key support to watch for.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.