March 13, 2019Market review and metrics for Forex, Oil, S&P500 & Yields.

Pivot points, Support, Resistance & Fibonacci Reversal levels; Chart of Interest – <Oil_WTI>. {updated 5PM EST}

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  • Market performance (DAILY)

    Market Performance (click to enlarge)

Market Comments
Forex Parliament rejects NO_DEAL BREXIT. The outcome was expected and priced in as the Pound rose quite sharply across the board. The next vote, to be held tomorrow, is to ratify an official request to the EU for a delay to the process. Assuming this is approved by the MP’s, it still has to be allowed by the EU. Rhetoric emanating from ranking officials is less than accommodating to this prospect. European Council President Donald Tusk, the de facto spokesman for EU governments, said a “credible justification” would be needed for a delay request to be considered. It would appear that EU is playing hardball, perhaps as a negotiating tactic, to pressure MP’s to reconsider PM May’s option (FIRST vote) or face the harsh reality that is NO-DEAL BREXIT. The Pound liked today’s outcome but it might not like the machinations prior to the March 29, 2019 deadline.  Antipodeans (NZD & AUD) were lower as concerns about economic growth resurfaced while another batch of weak inflation data weighed on the US unit.
S&P500 S&P500 closed up almost 0.80% though it was off its intra-day high. The oft mentioned resistance zone between 2800-20 has been under attack over the past few sessions as tepid inflationary data has traders pricing in a dovish FOMC going forward.
Oil & Yields
 The ongoing and worsening crisis in Venezuela has not received the type of attention that such an event would and should normally receive but that may change if the price of crude oil continues its ascent. By now the factors affecting the supply / demand paradigm are well documented. Slowing global growth prospects -vs- OPEC+ production cuts to stabilize crude oil at a higher price point have been in a tug-of-war for weeks. If one were to factor in the ability of US to affect supply through shale oil production then one could opine that OPEC+ policy initiatives should be unsuccessful over a medium term horizon. The x-factor is Venezuela. The political chaos leading to the worst blackout in that country’s history means that equipment cannot function which could, by some estimates, result in a loss of 700k + barrels per day(bpd). This is likely the impetus that pushed oil through the $58 level and, unless there is a counterbalancing increase in supply, could see price ratchet higher still to the mid $60’s area.
  • Chart of Interest – Oil_WTI (Daily)
    Oil broke through key resistance zone between $57.80 – $58 and surged over 2% to settle at $58.20. Confluence of support in the mid $54’s area contained the downward move propelling the commodity higher. Price action appears to be exhibiting bullish characteristics as it looks to test the upper bound of an ascending parallel channel. Markets should eye key resistance zone between $59.90 – $60 over the next few sessions. A break will bring resistance levels at $61.80 and $63.60 into play. Only a reversal through $54.30 will negate the developing bullish momentum.

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  • Pivot Points & Fibonacci Retracement Levels
    A technical analysis indicator used to try and determine the short-term trend of the market. The pivot point is calculated from the previous trading periods’ price action. If the market on the following period trades above the pivot point it is thought to be exhibiting bullish sentiment, whereas trading below the pivot point is seen as bearish. The Fibonacci retracement is the potential reversal of a financial instrument’s original move in price.

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