Market Focus of The Day.
The attention of traders has been dragged to the situation in the Suez Canal, where the massive ship blocked the way for tankers and container ships. The situation is crucial for oil as the Canal has a strategic mission for transporting around 12% of the global trade. The oil prices reacted quickly to this news. The price of WTI / crude oil spiked to the resistance at 61.4, while Brent was pushed to 64.60. However, the optimism turned out to be short-lived. The oil prices still remain under pressure due to renewed concerns of limited supply. Another bearish factor for oil is a build-up in crude oil inventories. Yesterday, the US Energy Information Administration posted a higher-than expected data. That’s why the oil prices seem attractive for sellers these days.
AstraZeneca Phase 3 trial of the vaccine in the U.S proved 76% vaccine efficacy against symptomatic COVID-19. According to the Fed representative Evans the U.S unemployment rate will drop to 4.5% in 2021 and the GDP growth will be at 6.5%. The United States continues to send out stimulus checks. It sent $325 billion in total. The Russian ruble has managed to recover after hitting the lowest point so far this year. Pessimism has covered risky assets, including the emerging market currencies and US stock indices. The surge in the US treasury yields is the main driver of this risk-off.
The euro has been under pressure amid tighter restrictions to contain Covid-19 and an increased demand for the US
dollar. EUR/USD is trading right above the 1.80 support. If this level is broken, the next support will lie at 1.1750. If
bulls take back their strength, the pair will try to reach 1.1750
The price of WTI jumped yesterday on the news that the ship blocked transportation in the Suez Canal. The price of
the asset plunged to 59.2 after the spike towards 61.40 (200-period MA). The breakout of 59.2 will increase
chances of reaching the next support at 57.20.
News sources: FBS.