Oil breaks into the $60s

Whilst the broader market saw increasing weakness across the day, there was notable strength in WTIC Oil, which saw a net daily gain of $1.38 (2.3%) @ $60.40. Continued upside into the summer looks due, with Oil set to battle into the secondary target zone of $67/75.


WTIC, weekly'2

Summary

So, WTIC Oil has now broken through the psy' resistance of $60. Most now recognise that the mid/upper $60s are due by late May/early June.

For me, the only issue is whether Oil gets stuck around $67.. or can briefly break into the $70s.. .before the next rollover.

Whether Oil can eventually take out the March low of $42.41 is very difficult to guess.

What is clear.. we've already seen over half of the expected bounce/retrace.
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China... a clear break lower

The Tuesday net daily decline of -4.1% @ 4298 is very decisive, and opens the door to a likely test of the psy' level of 4K.

Things really only get interesting if 4K is lost... next support would be the multi-year breakout zone of 3500/400s. Regardless of any near/mid term weakness, the giant 5K threshold looks a given this year.

*I will consider going long China around 4K.. via the ETF of FXI.
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Looking ahead

Wed' will see ADP jobs, productivity/costs.

*Amongst a number of Fed officials on the loose tomorrow, most notable will be Yellen speaking in the early morning.
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Goodnight from London