May we fill up the gas tank of the car?
Hello Traders
Jerome Powell has spoken and the economy seems to be not so "overheated" and the labor market seems calm after the "spikes" of 2020-2021. This could suggest that perhaps the much talked about interest rate cuts that have been mentioned may be coming. Powell spoke to the Senate informing them of the risks facing the economy. "risks on both sides" and with a labor market in apparent balance. He also made reference to the fact that if rate increases are implemented it will be based on measurable data, despite an election also coinciding in the same season.
Currently gasoline (Ticker AT: GASOLQ2) is at 2.5132 the current scenario looks like this. If there are no cuts, the price could go down towards 2.2988 and if there are cuts, it would climb towards 2.8500. Currently the Control Point (POC) is at 2.4992, so it is in a high trading zone at the moment. The RSI is at 41.67% slightly oversold.
Theory tells us that lower rates are gasoline for the markets in the short term, but if the Fed were to lower rates it would change the outlook. Especially in a context of oil supply problems.
Do you think rising oil prices will affect the Fed's rate hike plans or threaten the ECB's rate cut plans?
As always, I look forward to your comments.
Ion Jauregui - Analyst ActivTrades
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The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and such should be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
Jerome Powell has spoken and the economy seems to be not so "overheated" and the labor market seems calm after the "spikes" of 2020-2021. This could suggest that perhaps the much talked about interest rate cuts that have been mentioned may be coming. Powell spoke to the Senate informing them of the risks facing the economy. "risks on both sides" and with a labor market in apparent balance. He also made reference to the fact that if rate increases are implemented it will be based on measurable data, despite an election also coinciding in the same season.
Currently gasoline (Ticker AT: GASOLQ2) is at 2.5132 the current scenario looks like this. If there are no cuts, the price could go down towards 2.2988 and if there are cuts, it would climb towards 2.8500. Currently the Control Point (POC) is at 2.4992, so it is in a high trading zone at the moment. The RSI is at 41.67% slightly oversold.
Theory tells us that lower rates are gasoline for the markets in the short term, but if the Fed were to lower rates it would change the outlook. Especially in a context of oil supply problems.
Do you think rising oil prices will affect the Fed's rate hike plans or threaten the ECB's rate cut plans?
As always, I look forward to your comments.
Ion Jauregui - Analyst ActivTrades
*******************************************************************************************
The information provided does not constitute investment research. The material has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and such should be considered a marketing communication.
All information has been prepared by ActivTrades ("AT"). The information does not contain a record of AT's prices, or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information.
Any material provided does not have regard to the specific investment objective and financial situation of any person who may receive it. Past performance is not reliable indicator of future performance. AT provides an execution-only service. Consequently, any person acing on the information provided does so at their own risk.
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