After days of bullish news for Crude, WTI Oil has risen in 4 of the last 5 trading days. Let’s take a look at some of the bullish factors that are helping to push oil higher, from March 17^and:

1. IEA said 3 million bpd from Russia could be shut down
2. Ceasefire talks between Russia and Ukraine have failed
3. In what appears to be a deal reached last week, there is still no agreement for Iran to return to oil markets
4. Rumors swirl that Europe may ban oil imports
5. IEA chief says world could face biggest supply shock in decades
6. After small builds expected from DOE and EIA, both reported large drawdowns

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Accordingly, from these titles and stories, WTI crude oil rose. Crude had been rising since the spring of 2020 in an orderly fashion. However, on February 28^andthe price exploded when Russia invaded Ukraine, reaching a high of 129.42 on March 8^and. Price then returned to support on March 15^and nearly 93.56. Since, Crude rose again aggressively due to the factors mentioned above. Today, the price stalled at 115.37, just below resistance at the 61.8% Fibonacci retracement level from the March 8 highs.^and at the March 15 low^and at 115.70. Above there is horizontal resistance at 117.17 ahead of recent highs at 129.42. Support is at Tuesday low at 107.12, then horizontal support at 103.82.

Source: Tradingview, Pierre X

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The National Bank of Hungary raised interest rates by 100 basis points to 4.4% on Tuesday, the biggest rate hike since 2008, as high oil prices and war concerns raised the inflation. However, this had little effect on the Hungarian forint. USD/HUF has a high positive correlation with Crude Oil. This has guided the pair’s direction over the past month. The current correlation coefficient between WTI Crude Oil and USD/HUF is +0.85. Any reading above +0.80 is considered a strong correlation. When Russia invaded Ukraine, USD/HUF rose along with Crude Oil. Both made highs on March 7^and, with USD/HUF hitting a high of 368.058. Both pulled back towards support, with USD/HUF hitting a short-term low of 333.41 on March 17th.^and. However, since then, as crude rallied at the 61.8% Fibonacci retracement level, USD/HUF has been stuck at horizontal resistance and the trendline. Correlation measures how often the 2 assets move in the same direction, not the magnitude of the movement.

Source: Tradingview, Pierre X

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Resistance is at the March 18 high^and at 342.30. Above it is the 38.2% Fibonacci retracement level from March 7^and highs as of March 17^and the lows at 346.65, then the 50% retracement level of the same period at 350.73. The first support is at March 17^and lows at 333.41, then horizontal support at 324.94.

Crude oil has been on fire lately. There is a strong positive correlation between the direction of WTI Crude Oil and USD/HUF, which means that they move together in the same direction but not necessarily by the same magnitude. Nevertheless, if Crude Oil continues to rise, so does USD/HUF. However, if Crude Oil resistance holds, USD/HUF could quickly drop to new near-term lows!

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