23.03.201712:37 Forex Analysis & Reviews: Global macro overview for 23/03/2017

Global macro overview for 23/03/2017:

The closer we get to the next OPEC meeting in May 2017, the more complicated the situation in the crude oil market becomes. Some OPEC members are starting to show reluctance in their production cut efforts. However, since OPEC and non-OPEC oil producers have signed the deal on reducing supply, they have no other option except to extend the agreement until the end of 2017 (at the moment the January deal is set to expire on June). Terminating the deal in the middle of the year would not prove economically beneficial for the participants as they have already bound themselves to the commitment of curbing crude oil production. The main loser in that situation may be Saudi Arabia as it has already lowered its crude oil production significantly. In conclusion, crude oil prices may get very violate in the coming weeks ahead of the OPEC meeting. Besides, market participants may hear lots of comments from OPEC officials regarding the future of the supply cut deal.

Let's now take a look at the Crude Oil technical picture on the daily time frame. Despite the fact that the price is trading in the oversold market conditions, there is no sign of any rally as the technical resistance at 49.22 is still not violated. The golden trend line still provides the dynamic support. Once this level is violated, the price may not stop unless the level of 44.74 is hit.