Oil is making a comeback. Prices had already stabilized after the big crash last week when the inventory news broke out. The amount of crude stored in inventories dropped by 5.2 million barrels, far more than official expectations for a slide of 2 million. Early indicators probably tipped expectations lower. Nevertheless, this is quite a big fall and oil prices were ready to rumble.
Early indicators probably tipped expectations lower. Nevertheless, this is quite a big fall and oil prices were ready to rumble. WTI crude is currently trading above $47, a stubborn level of support, that was tested three times before breaking down.
Here is the WTI daily chart, showing the big comeback:
The rise in WTI was accompanied by other oil benchmarks and also by the Canadian dollar. The loonie was embattled with a mediocre jobs report in Canada, but oil remains the key driver.
USD/CAD is now at 1.3672, trading some 50 pips lower on the day. The low far has been 1.3650. Support awaits the pair at 1.3640. Further support is at 1.36 and then 1.3540.
The pair is still significantly above the previous trading levels.
More: CAD: What’s The Signal From ‘Home Capital Group’ Sage? – Barclays
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