Brent Oil Trims Gains, USD Sell Off Stalls
Brent prices backed off from the session highs as broad based USD selling appears to have run out of steam ahead of US ADP payrolls report release.
Rejected at $39.81
Prices clocked a high of $39.81 largely on the back of USD selling in early Europe. A smaller inventory buildup shown by American Petroleum Institute also helped prices strengthen.
However, the Energy Information Administration (inventory) figure is expected to show a 3.3 million barrel build, an increase to a record high for a seventh straight week. Consequently, oil traders remain cautious and are unwilling to boost prices ahead of the data release.
Furthermore, USD selling has halted for now as traders await US ADP private sector payrolls report, which is expected to show job growth slowed in February.
Brent oil Technical Levels
Oil currently trades around $39.60/barrel. The immediate hurdle is seen at $40 (5-DMA), above which prices could test 10-DMA hurdle of $40.58. On the other hand, a breakdown of immediate support at $38.87 (23.6% of Jan low – Mar high) would expose $38.30 (Mar 15 low).
(Market News Provided by FXstreet)