FXStreet (Delhi) – Derek Halpenny, European Head of GMR at MUFG, suggests that the price action in crude oil is certainly interesting and the extent of the squeeze toward the end of last week and again yesterday is reminiscent of the price action we got towards the end of August last year following heavy declines in response to the devaluation of the renminbi. Key Quotes “Back then over three trading days, Brent crude oil jumped 25%, which was then followed by a period of stability for two and a half months. The squeeze on this occasion is a little less but notable nonetheless with Brent crude oil up 15%. Certainly the price action may well dampen enthusiasm for speculative selling at these levels over the short-term. What was also notable yesterday was the way in which the equity markets in Europe and the US shrugged off the 6.4% drop in the Shanghai Composite Index yesterday. All the major markets outside of Asia advanced yesterday. We may be seeing the first signs of markets correlation with China diminishing once again. Oil prices are lower again today in part on expectations that today’s inventory data will reveal a notable build in stocks. The data will be released at 1530 GMT today. We maintain that the low-point for oil and also for oil-linked currencies like CAD and NOK will possibly be in this current quarter before gradually strengthening as oil prices stabilise and advance modestly in H2 2016.” For more information, read our latest forex news.