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Crude oil rallies ahead of OPEC+ meeting and inventory data

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The Canadian dollar moved sideways after the latest interest rate decision by the Bank of Canada. The bank decided to hike interest rates by 0.50%. Pushing the overnight rate to 1.50%. In addition, Tiff Macklem warned that more rate hikes were necessary to curb the soaring inflation. This was more hawkish than most analysts were expecting. The decision came a day after the country published mixed GDP numbers. The headline consumer price index has risen to a multi-decade high of 6.8%.

The US dollar index rose slightly after mixed economic data from the United States. According to the Institute of Supply Management, the manufacturing PMI rose from 55.4 in April to 56.1 in May. This increase was better than the median estimate of 54.5. Data by S&P showed that the manufacturing PMI declined from 59.2 to 57.0. There are signs that the manufacturing sector is doing well as supply chain issues improve. Additional data revealed that the number of job openings fell from 11.85 million to 11.4 million. Later today, the US will publish the latest initial jobless claims while ADP will release its private payroll numbers. 

The price of crude oil rose slightly after Shanghai started to end its two-month lockdowns. Brent rose to $117 while Western Texas Intermediate rose to $116. At the same time, the price of natural gas continued rising. In a statement, Shanghai authorities said that it had ended its lockdowns even as it set stricter measures like testing. This is seen as a positive thing for oil prices since China is the biggest consumer. Later today, the Energy Information Administration will publish the latest inventory data. Analysts expect that the data will show that inventories slipped by 0.067m barrels. At the same time, the OPEC+ cartel will hold its monthly meeting.

XBR/USD

The XBRUSD pair formed a break and retest pattern after it dropped to the support at 114.20. This was an important level since it was along the upper side of the ascending channel shown in white. It was also above the important resistance at 114.17. The price is also slightly above the 50-day moving average while the MACD has moved above the neutral level. Therefore, the pair will likely keep rising as bulls target the key resistance at 120.

Crude oil rallies ahead of OPEC+ meeting and inventory data

EUR/USD

The EURUSD pair slipped after the hawkish tone by Fed’s Mary Daly. In an interview with CNBC, she said that she supported moving interest rates to neutral this year. It dropped to a low of 1.0625, which was the lowest level since May 24. The pair moved below the 25-day moving average while the Relative Strength Index (RSI) and the MACD have moved lower. Therefore, its outlook is bearish, with the next support being at 1.0578, which is the 38.2% Fibonacci retracement point.

Crude oil rallies ahead of OPEC+ meeting and inventory data

USD/JPY

The USDJPY pair continued rallying amid a stronger US dollar. It rose to a high of 130.10, which was the highest level since May 11. The pair has jumped sharply from its May low of 126,15. It managed to move above the important resistance level at 129.43 while the Relative Strength Index and the momentum oscillators have moved upwards. Therefore, the pair will likely keep rising as bulls target the key resistance at 131.

Crude oil rallies ahead of OPEC+ meeting and inventory data

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