Crude Oil: Bullish Breakout to $80 on the Horizon Despite Slow Start to the Week
Following two days of consecutive gains toward the end of last week, crude oil has begun the new week on a downward trajectory. Early in European trading, when this report was written, oil prices were showing a decline of about half a percent.
However, based on what I interpret as positive price movements in recent weeks, the likelihood of a bullish breakout seems more plausible than a sell-off, possibly occurring later in the week.
The US markets will be closed on Monday for Presidents' Day, leaving the week devoid of significant macroeconomic events to closely monitor. However, attention will shift to China's return from a week-long holiday, which is expected to inject liquidity into global markets. Additionally, Nvidia (NASDAQ:NVDA)'s earnings mid-week could influence risk sentiment.
Another focal point for oil traders will be Thursday's release of global manufacturing and services PMIs, particularly from Germany and the Eurozone, where economic growth has trailed behind the US. These PMI data will offer insights into the health of major developed economies, many of which are net importers of oil. Stronger-than-expected PMI data could provide support to oil prices, indicating potential strength in demand. Conversely, weaker PMI data may raise concerns about recession, thereby exerting downward pressure on oil prices.
Meanwhile, the weekly crude oil inventories report from the US will be delayed by a day, scheduled for Thursday instead of Wednesday, due to the bank holiday on Monday. More on this later.
Oil has been quite choppy in recent weeks, partly due to the strength of the dollar. Despite supportive factors such as tensions in the Middle East, ongoing intervention by OPEC, and hopes for improved economic
Read more on investing.com
