Yahoo Finance Crude Oil Rallies Into the Close, as Hedge Funds Add to Bullish Positions
Crude oil prices were under pressure for most of the trading session on Monday, but bounced into the close and continue to face upward pressure. This comes despite rally in the dollar which has weighed on commodity prices. Hedge fund traders continue to add to long position in futures and options according to the lasted commitment of trader’s report released for the date ending April 17, 2018.
Technicals
Crude oil prices rallied into the close and continue to experience upward pressure. With Saudi oil remaining stable for the balance of April and May, imports into the United States will buoy prices. Prices bounced near support at the 10-day moving average near 67.34. Resistance is seen near the 69.50-handle. Momentum remains positive as the MACD histogram prints in the black with an upward sloping trajectory which points to higher prices.
Hedge Funds are Getting Longer
According to the most recent commitment of trader’s report released for the date ending April 17, 2018, managed money increased long position in futures and options by 21.6K contracts while reducing short position in futures and options by 3.3K contracts. Open interest that is long futures and options is slightly more than 14-times the volume that is short, which tells you which direction hedge funds are betting on. For the week to April 20, money managers held a net long position of 1.411 billion barrels of Brent, NYMEX and ICE WTI, U.S. gasoline, U.S. heating oil, and European gasoil. Funds held a total of 1.520 billion barrels of bullish positions in the six contracts on April 20, while the number of short positions dropped to the lowest in at least five years.
U.S. Chicago Fed national activity index fell 0.88 points
U.S. Chicago Fed national activity index fell 0.88 points to 0.10 in March after climbing 1.24 points to 0.98 which was revised from 0.88, with January revised to -0.26 from 0.02. That brought the 3-month average to 0.27 from 0.31 which was revised from 0.37, while January’s average dipped to 0.11 (revised from 0.16). The negative print on January was the first such since August. The report showed 44 of the 85 indicators made positive contributions, with 41 making negative contributions. The slippage isn’t a big surprise given all the angst and after coming off of the highest level since late 1999.
The FOMC’s tightening posture and Treasury supply have been two of the major culprits pushing up short term rates, which is buoying the dollar and weighing on oil prices. Long term rates, on the other hand, have been capped by the hefty global central bank accommodation that left the world awash in reserves and investors in search of yield, and until recently by benign inflation trends. While yields at the front end should be biased higher given expectations for a Fed rate hike in June, and increased Treasury supply, forces impacting the 10-year will be more mixed.
Canada wholesale shipment values dropped
Canada wholesale shipment values dropped 0.8% in February after a revised 0.3% gain in January (was +0.1%). The pull-back in shipments was contrary to expectations and runs counter to gains in manufacturing shipments and retail shipments during February. Wholesale shipment volumes tumbled 0.9%, a disappointing development for our 0.2% February GDP estimate.
This article was originally posted on FX Empire
