OPEC decided today to extend production cuts by an additional nine months until March of next year, as it tries to control the world supply following the collapse of oil prices and the decline in revenues over the past three years. The reduction is planned with 12 members from outside OPEC.
Nigeria and Libya continued to be excluded from the reduction decision in light of the unrest that had already limited their production. Saudi Arabia's oil minister, Khalid al-Falih, said Saudi Arabia's exports were set to decline sharply from June, thus helping speed up the rebalancing of markets.
Oil prices subsequently fell sharply, currently trading at a strong support level of $ 49 a barrel after markets have priced OPEC decisions and are making profits now.
Also during today's events, US President Donald Trump and European leaders agreed during his visit to start a plan of action on a US-EU trade deal, referring to the White House not rejecting free trade deals and promoting trade protectionism, as some in Europe fear.
The second estimate of UK GDP was below expectations. The UK economy slowed in the first quarter and grew only 0.2% quarter-on-quarter and 2% year-on-year, driven by a sharp slowdown in consumer spending, pushing the Pound lower against the US dollar 1.2930 levels.
In New Zealand, the government, through its budget today, expects the economy to grow over the next five years to 3.1% by increasing spending in a number of sectors.
On the technical view, the most significant moves during the day were as follows:
Prices pulled back near to the bottom line of the ascending channel besides MA 100, then bounced higher. We can buy the pair from the bottom line at 1.2925 and sell from the upper line at 1.3085. Penetrating any of these levels could move prices sharply.
As we mentioned in the morning report breaking 51.30$ down would accelerate declining pace targeting 49.50$, and this is what happened, staying higher than this level would send prices for testing levels of 50.50$. but in case of breaking current levels we would see more decline to levels of 48$ then 47$.