Drones with Explosives wipe out 5% of world oil supply!
Today’s market driven data is focused on oil. On Saturday, September 14th, 10 drones with explosives attacked 2 crude processing facilities Abqaiq and Khurais in Saudi Arabia. Abqaiq is operated by Aramco and is the largest oil processing facility in the world.
The state of the damage is not yet clear but the attack has wiped out 5% of the world’s oil supply, which is about 6 million barrels and half of Saudi’s oil production.
As a result, WTI gapped up by 13% and Brent Crude by over 14%. The price has stabilized some after president Donald Trump announced that he has authorized the release of oil from the Strategic Petroleum Reserve to make sure that there is sufficient supply.
Safe haven assets like the Japanese Yen, Swiss Franc and Gold also rose.
Investors are now waiting to see the next steps taken by Saudi Arabia and the United States. Thus far there is only finger pointing. Iran denies having involvement, while a Yemen's Iran-backed Houthi rebels claimed responsibility. President D. Trump twitted that the US was ‘locked and loaded’ awaiting confirmation form the Kingdom, warning that he was prepared to take military action.
Let’s analyze the pair AUDCHF. The pair gapped down but the price met local support trend line and bounced. The pair has since closed the gap.
In case there are further negative developments from the Gulf and investors rush to safe haven assets, the pair can consider short positions if the local trend line is broken down, in which case our target areas will be the 38.2% Fibo at 0.67130, then 50% Fibo at 0.66722 followed by 61.8% Fibo at 0.66314.
We see that the Lagging Span has failed to intersect the price chart. Further growth for the pair will have target areas at 0.68388 resistance level, followed by resistance at 0.68614 and then 0.68883.
The state of the damage is not yet clear but the attack has wiped out 5% of the world’s oil supply, which is about 6 million barrels and half of Saudi’s oil production.
As a result, WTI gapped up by 13% and Brent Crude by over 14%. The price has stabilized some after president Donald Trump announced that he has authorized the release of oil from the Strategic Petroleum Reserve to make sure that there is sufficient supply.
Safe haven assets like the Japanese Yen, Swiss Franc and Gold also rose.
Investors are now waiting to see the next steps taken by Saudi Arabia and the United States. Thus far there is only finger pointing. Iran denies having involvement, while a Yemen's Iran-backed Houthi rebels claimed responsibility. President D. Trump twitted that the US was ‘locked and loaded’ awaiting confirmation form the Kingdom, warning that he was prepared to take military action.
Let’s analyze the pair AUDCHF. The pair gapped down but the price met local support trend line and bounced. The pair has since closed the gap.
In case there are further negative developments from the Gulf and investors rush to safe haven assets, the pair can consider short positions if the local trend line is broken down, in which case our target areas will be the 38.2% Fibo at 0.67130, then 50% Fibo at 0.66722 followed by 61.8% Fibo at 0.66314.
We see that the Lagging Span has failed to intersect the price chart. Further growth for the pair will have target areas at 0.68388 resistance level, followed by resistance at 0.68614 and then 0.68883.