- January 14, 2019
- Posted by: Trading
- Category: Alerts
Oil Price Analysis and News
- Chinese Slowdown Fears Resurface Following Woeful Trade Data
- Oil Imports Provides Slight Hope for Oil Bulls
Chinese Slowdown Fears Resurface Following Woeful Trade Data
Oil prices dipped overnight after poor China trade data. The latest data showed a surprise fall in Chinese imports of 7.6% vs. expectations of a 5% gain, while exports had dropped 4.4%, missing estimates of a 3% rise. Consequently, fears of a Chinese slowdown have resurfaced with the US-China trade dispute adding to the downside risks that the Chinese economy is facing.
Oil Imports Provides Slight Hope for Oil Bulls
Despite the weakest Chinese trade surplus since 2013, oil imports had been up 30% in December from a year earlier, having reported the second highest monthly reading on record. As such, China’s crude imports rose 10% for the whole of 2018, making China the world’s largest importer of oil for the second consecutive year. Subsequently, while the slowdown in China is increasingly evident, demand for crude continues to remain elevated.
Oil Impact on FX
Net Oil Exporters: These counties tend to benefit when the price of oil rises. This includes RUB, CAD, MXN, NOK.
Brent Crude Price Chart: Daily Time-Frame (Apr 2018 – Jan 2019)
Having made a break below the $60 mark, eyes will be on for a close below, which could see Brent make a test of the 23.6% Fibonacci retracement at $58.84.
RECOMMENDED READING FOR OIL TRADERS
— Written by Justin McQueen, Market Analyst
To contact Justin, email him at Justin.email@example.com
Follow Justin on Twitter @JMcQueenFX