11.12.201814:26 Forex Analysis & Reviews: The oil made a halt

After a stormy two-day debate, OPEC finally decided to reduce oil production by 1.2 million b / d compared with October levels. The agreement will be valid for 6 months and will help balance the market in the first half of 2019. Thus, the cartel stepped on the throat of Donald Trump, who actively urged not to do so and provide black gold prices with chances to continue the peak. The US president compared his low cost with a kind of tax cuts for the global economy. They did not hear him in Vienna and even allowed themselves to be smacked. Say, the growth of Brent and WTI will enable American manufacturers to sigh with relief.

Despite the fact that such details of the agreement do not apply, tabloids bit by bit collect information. Among the discharged were Iran, Libya, and Venezuela. The OPEC cut is estimated at 800 thousand b / d, other manufacturers, including Russia, at 400 thousand b / d. At the same time, Moscow accounts for about 200 thousand b / s. This figure appeared in the message of the Russian Federation on readiness to reduce production by 50-60 thousand b / d and gradually bring the figure to the required 200 thousand b / d.

After the announcement of the Vienna agreement, Brent soared above $ 63.5 per barrel, but the situation gradually stabilized, and the North Sea variety returned to consolidation in the $ 57.5-63.5 range. Its dynamics are affected not only by production but also by global demand, as well as fluctuations in the dollar exchange rate. In this regard, the reduction in Chinese oil imports in January-November was an occasion for sales.

Dynamics of Chinese imports of commodities

The stabilization of the USD index plays a significant role in the development of the consolidation of Brent and WTI. The fall in the likelihood of the Fed's monetary policy normalization cycle in 2019 to 49% puts pressure on the US dollar, but its competitors are still not flashing: the pound falls into the abyss due to the cancellation of the draft agreement with the EU by the British Parliament in the British Parliament and pulls is the euro. Opponents find out who is the weakest link, which leads to range trading on the USD and oil index.

Technically, after reaching a target of 113% for the Shark pattern, as a rule, it is transformed into a 5-0 pattern. It is expressed in a correction to the current downtrend in the direction of 23.6%, 38.2% and 50% of the CD wave, followed by a return to sales. Moreover, the longer the consolidation in the range of $ 57.5-63.5 per barrel, the higher the chances of a sharp pullback or continuation of the southern hike.

Brent, the daily chart