The night after Trump's announcement of the unilateral withdrawal of the US from a nuclear agreement with Iran does not bring a fundamental variety of sentiment. This factor mainly dominated the crude oil market and indirectly influences others, i.e. it does not lead to an increase in risk aversion, which, for example, would strengthen the yen. However, it influences the increase in inflation expectations, which strengthens the dollar against the Japanese currency. The WTI rate erased all of yesterday's breakdown and is close to Monday's long-term high of USD 70.70. In the currency market, the dollar remains strong and the stock market has not taken a clear direction.
The EUR/USD pair is on this year's lows around 1.1850. The sale of AUD, which is the weakest to the dollar for almost a year, continues. AUD/USD hit a bottom around 0.7425. Oil rebound allows you to make up some of the losses by CAD. USD/CAD is 50 pips away from yesterdays highs almost at 1.30. USD/JPY is currently the most violate pair and is growing above 109.50 to the top of the month. GBP/USD remains close to this year's lows around 1.35. The profitability of the American 10-year bonds is pushed out by the growing crude oil and is again flirting with a ceiling of 3.0%
On Wednesday 9th of May, the event calendar is busy with the important data releases. The main event of the day is the Reserve Bank of New Zealand interest rate decision and rate statement. But before that, the market participants should keep an eye on French Industrial Production data, the Building Permits data form Canada, Producer Price Index, Wholesale Inventories and Crude Oil Inventories data from the US.
Crude Oil analysis for 09/05/2018:
On the commodity market, the focus is primarily on the return of Crude oil to the Monday highs that is the long-term maximum. The API report played a significant role in this. The market expected a modest increase in inventories, which, contrary to expectations, fell by 1.85 million barrels. What's more, the stocks of distillates have shrunk the most in over a dozen years, as many as over 6.6 million barrels and gasoline inventories have fallen by more than 2 million barrels. Today there is another data release that might affect the price of Crude Oil - the stockpiles of US producers that are expected to grow to the level of 6218k barrels. Any number lower than this will make the oil to rally even higher above the level of 70.82. The immediate support is seen at the level of 69.56, but the key technical support remains at the level of 66.86. As long as this level is not violated, the outlook remains bullish. The next target for the price is seen at the level of 76.95 (61% Fibo of the previous swing down at the weekly timeframe chart).
