Global macro overview for 22/05/2017:
The next Organization of the Petroleum Exporting Countries (OPEC) meeting is scheduled for this Wednesday, Thursday, and Friday, as part of a panel to discuss the different scenarios ahead of the Thursday, May 25 meeting with non-OPEC members. There are still rumors that there is no agreement on the final scenario with an option of additional cuts as US shale production continues to increase. Nevertheless, market participants assume that the supply cut would not only be extended into next year but might also be deepened in order to tighten the market and prop up prices.The outcome of the meeting will be undoubtedly important for the whole oil industry and will increase the crude oil price volatility.
Let's now take a look at the USD/CAD technical picture on the H4 timeframe as this currency pair is highly correlated to the oil prices. The price stopped at 50%Fibo at the level of 1.3508, however, the bulls do not have the strength to outline the upward rebound. This indicates a continuation of the move towards 61%Fibo in the 1.3440 area. The resistance for a possible upwards correction will be at the level of 1.3575, where we find 23.6%, 38.2% retracement levels and local lows from May 16-17.
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