Oil drops lower and will probably close negative for January.

By Tomasz Wisniewski|

Published: January 31 2023, 08:04 GMT+0

Oil drops lower and will probably close negative for January.


Monday trading was quiet and most probably, the same will happen today. The only fireworks could have been observed on the commodities market, where energies were having a really bad day. Natural Gas, for example, dropped yesterday 6% and made another, long-term low. Oil also went south around -2.4% and in the case of the Oil, this can lead to serious technical implications. Brent Oil for example is currently dropping below the long-term down trendline, which would mean a comeback to the bearish trend. WTI, on the other hand, is still above the down trendline but dropped below the neckline of the iH&S pattern, which was promoting the upswing in the first half of January.

Today, other commodities join the selloff party, mostly precious metals. Platinum is down 1.7%, Silver drops 1.1%, and Gold trades 0.4% lower than yesterday. Yesterday, we could have blamed it on the gains in the USD, which was the strongest currency in the pack but today, USD does not move much. We can see interesting moves on the Australian Dollar though. Yesterday, it was the weakest currency among majors and today this trend is continued. The answer to why can be found in the calendar. On a monthly basis, retail sales in Australia fell 3.9%! The number of -0.2% was expected, so you can see the scale of a miss here.

Futures followed the commodities yesterday and recorded a bearish session. Futures are also red today morning. It is the last trading day of January and we have to admit that this month was pretty successful for the buyers, even with the recent drop. Let’s see if the buyers will make a last push today, to score even better results in January.

In today’s calendar, we can see a few interesting positions. First of all, we got good data from Japan, where retail sales rose 3.8% and Industrial Production was only -0.1% lower vs the estimates, which were at -1.1%. We also got PMIs from China, where the non-manufacturing one came at 54.4, which beat the estimates of 52. Further down the road, we will see the Prelim Flash GDP from the EU and the GDP data from Canada. The day will finish with the CB Consumer Confidence number from the US and the job data from New Zealand.

Source: https://www.axiory.com/analytics/market-news/oil-drops-lower-and-will-probably-close-negative-f