Crude oil price drops as US oil rigs rise for a seventh straight week
The Australian dollar declined in early trading even after the relatively strong economic data from Australia and China. According to the Australian Bureau of Statistics, the country's total retail sales rose by 7.1% in November, helped by the robust holiday season. This increase was slightly better than the consensus estimate of 7.0%. It was also better than the previous increase of 1.6%. Meanwhile, in China, consumer prices increased by 0.7% in December leading to an annual decrease of 0.4%.
The price of crude oil declined in early trading as traders reacted to the latest rig count in the United States. In a report released on Friday, Baker Hughes said that the country’s oil rigs increased by 8 to 275. This was the seventh straight week of increases and is a sign that the country’s production will keep rising. The current rig count is substantially higher than last week’s low of 172 but it is still lower than last year's high of 660.
The price of cryptocurrencies erased most of their weekend gains as global assets declined. Bitcoin, the biggest digital currency, declined by more than 4,000 points to the current $36,000. Similarly, the price of Ethereum, Ripple, and Bitcoin Cash are all down by more than 10%. This price action is possible because other assets have dropped as well, with futures tied to the Dow Jones and S&P 500 falling by more than 0.50%.
The EUR/USD pair continued the decline started last week as part of the overall strong dollar. The pair is trading at 1.2177, which is lower than this year's high of 1.2225. On the four-hour chart, this price is below the rising trendline and the 25-day and 15- day moving averages. Also, the bearish divergence pattern shown by the Relative Strength Index (RSI) and the MACD has continued to form. It is also along the 23.6% Fibonacci retracement level. Therefore, the pair will possibly continue falling, with the next target being at 1.2100, which is at the same level as the 38.2% Fibonacci.
The GBP/USD pair dropped for the fourth consecutive day due to the strong dollar. On the four-hour chart, the price has moved below the 25-day and 15-day exponential moving averages. Also, it is substantially lower than this year's high of 1.3568. The RSI and the MACD have also continued to fall. Therefore, the pair will likely continue falling today as bears target the next support at 1.3427, which is the lowest level since December 28.
The XBR/USD pair declined by more than 1.5% to the current level of 55.53. This price is slightly lower than last week’s high of 56.20. It is 14% lower than last year's high of $66. On the four-hour chart, the price is still above the 25- day moving average. Also, the RSI has been forming a bearish divergence pattern. Therefore, while the upward trend will likely continue, there's a possibility of a bearish reversal soon.