Oil outlook

From the FXWW Chatroom: Oil is about 50 cents lower this morning after API data showed US crude inventories increased 882,000 barrels last week and the IEA raised its forecast of both US and non-US, non-OPEC production. The agency now expects output outside the cartel that agreed to cap production will rise by 1.4mm barrels per day by the end of this year. EIA inventory data, more accurate than API data, will be released at 10:30 today.
According to the WSJ, OPEC has been communicating with hedge funds, encouraging them to buy oil before announcing production cuts/freezes. This explains why even failed negotiations briefly lifted the market last year. But apparently fund managers are sick of failed promises to deliver higher prices, even when Russia and OPEC can agree to cooperate. As a result, future attempts to manipulate prices are likely to be effective only if they manage to change the balance of supply and demand.
DXY has not been able to move more than 1% beyond the 100 weekly average since last year. the 100WMA is right here at 97.60. However, for the 1st time in 12 months, DXY is trading below a key channel line, indicating broad USD weakness ahead.
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