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Oil Prices Shoot Higher On Fundamentals

By:
Colin First
Updated: May 15, 2017, 09:36 UTC

The theme of the day so far has been the jump in the oil prices and the subsequent strengthening of the CAD along with it. The build up of the prices in

Oil Prices Shoot Higher On Fundamentals

The theme of the day so far has been the jump in the oil prices and the subsequent strengthening of the CAD along with it. The build up of the prices in oil had been going on for most of last week when it rose by more than 3% on one day and the 1% on the next day and the rise today is seen more as a continuation of the build up.

Oil The Star of the Day

Oil prices have risen by more than 2% so far as reports came in that Russia, Saudi Arabia and other oil producers have agreed to continue the production cut deal for the next 9 months atleast. This would mean that the deal would carry on for the rest of the year and this would help to cut the supply even further and help to push up the oil prices.

Oil Hourly
Oil Hourly

Though the deal has been running since the beginning of the year, it is only in recent times that the production cut has been reflecting in the inventory. So far, we have seen data show that the production continues to be high from the other producers like Libya and the inventory has begun to fall only in recent weeks.

This rise in oil prices has helped it to break through the $49 region and now begin to eye the important psychological mark of $50. This has also helped to strengthen CAD across the board which has pushed the USDCAD below 1.37.

Other pairs continue to trade within a tight range though the dollar weakness seems to be dominating the market as of this writing. This has helped to push the EURUSD and GBPUSD pairs higher, through their resistance regions and confirming their bullish outlook for now. It remains to be seen what the first US session of the week will bring us.

About the Author

Colin specializes in developing trading strategies and analyze financial instruments both technically and fundamentally. Colin holds a Bachelor of Engineering From Milwaukee University.

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