Crude oil prices declined in early trading after OPEC+ members reached a deal to increase production gradually as oil prices rise. The members will add about 400k barrels a day every month from August and then ramp it up by about 2 million by the end of the year. The members will then accelerate the increases. The increase is a sign that the members fear that the global recovery will not be as strong as expected. The new deal came after weeks of disagreements between Russia, Saudi Arabia, and the United Arab Emirates. The deal is a victory for the UAE since it will award higher production baselines to countries like Saudi, Russia, and Kuwait.

The global equities sell-off accelerated in early trading as investors waited for key corporate earnings. Dow Jones and S&P 500 futures declined by 200 and 20 points while futures tied to the DAX and FTSE 100 indices dropped by more than 0.50%. The decline happened as investors started pricing in an eventual cooling of the American economy after it recorded a stronger recovery in the first half of the year. Later this week, the indices will react to the latest corporate results from companies like J.B Hunt Transport Services, AutoNation, IBM, Ally Financial, Sleep Number, Netflix, and UBS.

The Nasdaq 100 index futures declined to $14,635 as the earnings season continues. The pair broke out below the 25-day and 15-day moving averages while the RSI and MACD indices kept falling. The index also formed a double-top pattern. Therefore, there is a possibility that it will keep falling as bears target the next key support at 14,500 as temporary level - which if broken would send the market towards our best buying level i.e 14260. 

NAS100 D1

Jul 19 2021