Published: Sat, June 23, 2018
Markets | By Otis Pena

OPEC countries to pump more oil to contain price increase


A cluster of DMAs (20, 55) from $75.40-85 will initial targets for oil bulls on the topside, before a potential test of the 23.6% Fibonacci retracement of the $61.67-80.49 rise at $76.05. It's a little stop of the bleeding.

"A lot of people feel this market is oversold".

The energy sector was the biggest gainer of the benchmark S&P 500 index, rising 2.2 per cent, while the technology sector was the weakest with a 0.4 per cent drop.

Two years ago, OPEC and Russian Federation set about raising the price of oil by cutting output.

Major oil producers agreed Friday to a nominal increase in crude production of about 1 million barrels per day, a bid to put a damper on high oil prices.

Prices had rallied in 5 waves and after that the correction which we saw can be termed as wave a and now prices could have a pullback in wave b towards 38.2 retracements at 67.10, 50 percent is at 68.2 and 61.8 percent is at 69.3 and after that we could see correction in prices in wave c which can go below 61.80.

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However, investors grew more nervous this week about the possibility of a full-blown trade war over increasingly sharp rhetoric between the United States and China, and growing evidence of the wider economic impact of this conflict.

Chinese state media said on Friday that U.S. protectionism was self-defeating and a "symptom of paranoid delusions" that must not distract China.

The production limits by the Organization of the Petroleum Exporting Countries and Russian Federation since 2016 have helped increase oil prices, with the benchmark US crude contract hitting its highest level in more than three years in May. This leaves US consumers with more money to spend elsewhere, a boost to the USA economy. The euro was up 0.5 per cent to $US1.1659.

China kept up its hostile rhetoric with the United States on Friday, saying through the official China Daily that US protectionism would hurt its own economy.

Rising trade tensions between the U.S. and China continues to remain a prominent theme with neither side showing any signs of backing down.

The dollar index, which tracks the USA dollar against six major currencies, fell 0.22 per cent.

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