Global macro overview for 01/12/2016:
Oil prices rallied on Wednesday, as OPEC members reached a deal on production cuts at the meeting in Vienna. It is the first time since 2008 when the OPEC members have agreed to cut the oil production by 1.2 mbpd to 32.5 mbpd. The agreement should reduce the worldwide supply glut of oil and stabilize oil prices, on the assumption that OPEC members do keep the agreement decisions. The agreement made the oil prices to rally over 8% as another boost for price came after a weekly update on US Crude Oil Inventories was released. US stockpiles surprised global investors again with a decline of 0.9 million barrels, while market participants had expected a surplus of 0.7 million. In conclusion, Thursday is a very good day for oil, both WTI and Brent, in the wake of the long-awaited production cut deal. This is why even higher prices are expected on both benchmark grades.
Let's now take a look at the technical picture of Crude Oil in 4H time frame. The price has broken out above the golden trend line resistnace and now bulls are in full control of the market. Currently the price is trading around the techncial resistnace at the level of 50.04, but the next target for bulls seems to be at the level of 51.93.
