• Brent oil prices hit their new 4-year high in anticipation of a Trump’s announcement
  • Stocks in Asia climb higher after the successful end of last week’s trading on Wall Street
  • Australian dollar moves lower following disappointing construction PMI

Oil prices have been in the spotlight for some time mostly due to their steady bullish trend, the Asian session brought a continuation of such a scheme. Brent prices have already struck their highest point in almost four years as investors are bracing themselves for a possible reimposition of US sanction on Iran. Let us remind that US President Donald Trump said that his decision whether the US stays in or pulls out of the Iran nuclear deal will be announced till 12 May. If Trump walks away from the agreement, it would likely result in a reduction of Iran’s oil exports (the country is OPEC’s third largest producer therefore its amount of oil matters for the whole cartel). Moreover, it’s also worth noting that oil prices shrugged off the latest Baker Hughes data showing US drillers added as much as 9 oil rigs last week suggesting higher prices keep encouraging US-based producers to ramp up output. It shows that the oil market may have become one-sided, and with still remarkably high speculative positioning it could portend a possible pullback over the next weeks but it may take time anyway.

link do file download linkBrent oil prices continue creeping up after a successful test of a support placed a touch above $70. The nearest target bulls could aim for might be localized nearby $82. Source: xStation5

Looking elsewhere one may notice that Asian stocks have performed quite well thus far with the Shanghai Composite adding over 1.1% at the time of writing. Gains could be stimulated by the decent close of the past week on Wall Street where major indices managed to add clearly above 1% each. The SP500 futures are pointing to a green opening today as well rising slightly more than 0.3% in early trading. On that account European stock markets are also expected to begin higher with major attention paid to Italy. The country could be at a tipping point as it may end its two-month political stand-off as Five Star Movement leader Luigi Di Mario suggested he’s ready to give up his quest to be prime minister so as to begin talks with Matteo Salvini (The League) on forging a new government. We are going to provide more on this theme in our daily post regarding the German DAX (DE30 on xStation5).

link do file download linkThe AUDUSD fell last week but it also drew an encouraging candlestick around 0.75 which could be looked as the first sign of bulls’ fatigue. If this level is held over the next days it could give rise to an upward pullback. Source: xStation5

On the currency front we can conclude that the Australian dollar has been by far the weakest currency so far losing almost 0.3% against the US dollar which has begun this week’s trading a bit lower. The Antipodean currency could have been afflicted by weak construction PMI for April as it slid to 55.4 from 57.2. Deterioration was seen in each category such as housing, commercial or engineering activity.