WTI - Will Oil Return to the Uptrend?!WTI oil is below the EMA200 and EMA50 on the 4-hour timeframe and is moving within its medium-term descending channel. If the downward trend continues towards the demand range, the next opportunity to buy oil with a risk-reward ratio will be provided for us. An upward correction of oil towards the supply range will provide us with an opportunity to sell it.
Despite markets showing resilience to geopolitical uncertainties following recent tensions between U.S. President Donald Trump and Ukrainian President Volodymyr Zelensky, any signs of economic weakness in the United States could prompt investors to raise their expectations for interest rate cuts. However, even if inflation data does not reinforce such expectations, it is unlikely to have a significant impact on the U.S. dollar.
In the United States, inflation remains a major challenge for the Federal Reserve. The overall Consumer Price Index (CPI) rose to 3% in January, dashing hopes for two rate cuts in 2025. However, the market’s reaction was not overly negative, as investors anticipated that the Personal Consumption Expenditures (PCE) index, which the Federal Reserve prioritizes, would be less severe than the CPI.
According to the Cleveland Federal Reserve’s Nowcast model, the core PCE index fell from 2.8% to 2.7% in January, while the overall PCE rate declined to 2.5%. If the actual data released on Friday aligns with these projections and no unexpected increases appear in the monthly figures, expectations for two 0.25% rate cuts may strengthen, exerting downward pressure on the U.S. dollar.
Meanwhile, U.S.President Joe Biden attempted to foster freer elections in Venezuela by extending an offer of cooperation, but this initiative failed. Now, Trump has announced that he will terminate this policy. He also noted that Venezuela is refusing to take back illegal migrants who had arrived in the U.S.
This agreement, which had eased sanctions on oil, gas, and gold, was partially revoked in April 2024 after opposition candidate María Corina Machado was barred from running in the presidential election. Trump wrote on Truth Social: “We hereby revoke the concessions that corrupt Joe Biden granted to Nicolás Maduro of Venezuela regarding the oil deal dated November 26, 2022, as well as the electoral conditions in Venezuela, which the Maduro regime has failed to meet. Additionally, the regime has not returned the violent criminals it sent to our great America as quickly as promised. Therefore, I am ordering that Biden’s ineffective and unmet concessions be revoked as of the March 1 extension date.”
Today, Trump escalated his stance on Venezuela by canceling Chevron’s oil license. This move was prompted by Caracas’s refusal to accept deportees and implement democratic reforms. President Trump announced that he would revoke the Biden-era license that had allowed Chevron to produce oil in Venezuela.
This decision appears to be a significant setback for Chevron, the American oil giant. On his social media platform, Truth Social, Trump stated that he would rescind the license granted on November 26, 2022, which had permitted Chevron to operate in Venezuela.
