Article / 28 September 2016 at 23:27 GMT

US Market Wrap: Oil gushes on Opec deal

FX Trade Strategist /


  • Japan: Foreign Investment and Retail Trade                    1950 GMT

US Data released:

  • Durable Goods-August (Actual 0.0% vs. forecast -1.4% 
  • EIA Crude Stocks Change: Actual -1.882 million barrels versus prior -6.2 m/b) 

Today was all about oil. Rumours and reports of deals and denials of deals flooded the markets as the Opec meeting in Algiers was winding down.

In fact, one such denial of an agreement snapped a WTI rally on the back of news of another drawdown in US crude stocks, as reported by EIA.

The drop was brief and WTI ticked up steadily. Then news of a deal. WTI accelerated from $46/barrel to $47.40/b. At 0746 AEST (2146 GMT, Wednesday), it was back to $47.16/b.

As deals go, it isn’t much. The details are unknown except that Opec plans to reduce output by 750,000 barrels per day which is really a couple of drips in a 90 million barrel a day market.

USDCAD was the big loser. It plummeted to 1.3086 from 1.3268. Aussie and Kiwi rode the Loonie's tail feathers higher.

Federal Reserve chairwoman Janet Yellen repeated that the Fed had no fixed time table for bumping US rates up and admitted the need to “remove accommodation”, if things continued on their current course.

retreated on the news but that move quickly petered out. GBPUSD couldn’t decide which way to go so it bounced choppily within a 1.2980-1.3030 band. USDJPY was quiet.

The Opec news lifted US equity indices out of the red and into the green, led by energy company gains.


Even the best data sets bear closer scrutiny when trading FX writes Trading Floor contributor "fxtime" in his article: How can traders use simulation models?

 In early Asian trade, WTI had risen by $2.38, or 5.3%, to $47.05/b. Photo: iStock

-- Edited by Adam Courtenay

Michael O'Neill is an FX consultant at IFXA Ltd. Follow Mike or post your comment below to
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Missed a day? Here’s what we had to say during our Asian session and our regular European Morning Markets, From the Floor and Mid-session Europe.


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