Energy futures moved north yesterday, but well off of their lows as the lack of any real news caused lighter volumes and a wider trading range. Brent crude is holding above $113.00 this morning ahead of GDP data from both the Euro-Zone and Germany. Currently the debate on whether Israel will make a pre-emptive strike on Iran is helping to put in a short-term floor in the market. We also have to take into account that poor GDP data from the Euro-Zone will push the Euro lower, which in turn will move the dollar higher, which could weigh on commodities which are priced in USD. Turning to last night’s closing levels, Brent crude closed out the session at $113.60 up $0.65. WTI crude closed out the session at $92.73 down $0.14. Gasoil closed at $957.25 up $2.25 while UK Nat Gas closed at £56.74 up £0.100.
The Euro is currently extending yesterday’s gains this morning after French GDP data came in flat and the expectations were for a slight contraction. We have been trading in a tight range for the past week on the Euro unable to make a clear break above 1.24 or below 1.22. We see next resistance at 1.2390 ahead of 1.2445. On the downside we draw first support at 1.2260 and again at 1.2195.
Equities closed lower yesterday but only slightly so with the FTSE in the UK closing at 5831.88 down 15.23. In the US the DJIA closed at 13169.43 down 38.52 while the S&P closed at 1404.11 down 1.76. The DAX is up some 49.0 points at 6963.0 this morning indicating a higher open for the rest of Europe ahead of the data. The VIX dropped again yesterday to 13.70, while Gold is trading at 1613.40.
In economic data today we have GDP data from both the Euro-Zone and Germany as we mentioned earlier. Later on this morning we have CPI data out of the UK and the German ZEW Survey. Over in the US we have Advanced Retail Sales data, which is followed up with US PPI for July.
For Brent crude we draw first resistance at $114.00 followed by $115.00. On the downside we draw first support at $113.00 followed by $112.00.
For Gasoil we draw first resistance at $958.00 followed by $963.00. On the downside we draw first support at $953.00 followed by $948.00.