Forex news for North American trading on July5, 2021
- Iraq: We are committed to our agreement with OPEC+
- Crude oil trades to a new cycle high
- PM Johnson as expected lifts lockdown restrictions
- European indices end the session higher
- Sources: OPEC+ JMMC co-chairs require time to discuss UAEs position
- OPEC+ meeting has been postponed. OPEC production levels will remain the same. Crude oil prices move higher.
- Bank of Canada business outlook survey hits highest level on record
- More from Zandi: We can increase production every month until April 2022
- Energy Intel Baker: OPEC meeting SHOULD start soon
- OPEC+ source: Efforts underway to postpone OPEC+ meeting
- The GBP is the strongest and the NZD is the weakest to start the Canada trade session
The US market was closed in observance of the 4th of July holiday. No stock or bond trading. Forex markets were open with price action limited. Looking at the low to high trading ranges, the USDCAD range of 58 pips was the largest with the price action in the pair retracing earlier gains to the downside after the BOC business outlook survey hit its highest level on record. The commentary was largely positive on a strong reopening to the economy with expectations for transitory inflation.
The strongest to the weakest currencies shows the GBP is the strongest and the NZD is the weakest. The USD is ending the session mixed with gains vs the CHF and CAD, but declines vs the GBP, JPY, NZD. The EURUSD and the NZDUSD is near unchanged on the day.
The anticipated OPEC+ ministers oil output meeting was called off on Monday, after UAE requests for a change in their baseline output numbers were denied. The UAE agreed to a 400K output raise from August to December, but rejected extending remaining cuts to the end of 2022 from a current end date of April without adjusting its current baseline production. The UAE is upset about its low baseline from which its cuts are calculated and want it raise. Cited it changes in the baseline for other countries including Azerbaijan, Kazakhstan, Kuwait and Nigeria. Since decisions in OPEC+ need to be unanimous, and the UAE was not budging, the meeting was called off until a further date.
As a result of the decision, the price of crude oil traded to its highest level since October 2018. The high price reached $76.31. That was a above the high price from two days ago at $76.20, but short of the October 3, 2018 high price of $76.88. Should that level be broken, the price would be trading at the highest level since 2014.
In other news today, UK's announce that Covid restrictions would end on July 19.
The GBPUSD is higher on the day, but trades between its 100 hour moving average at 1.38139 and 200 hour MA at 1.38614. In the new trading day it will take a move outside that range to solicit more momentum in the direction of the break. The buyers tried to extend above the 200 hour MA but failed.
The EURUSD is ending the day near the 100 hour MA at 1.18624. The USDJPY is trading near its 200 hour MA at 110.91 (trading at 110.94). In the new day, the price action will likely move away from those MA barometers and in doing so, tilt the bias in the direction of the break.
