Oil inter-market: not in a hurry to move back above $50.00

Following a slide on Wednesday, snapping three-day of winning streak led by smaller-than-expected decline in US stockpiles, WTI crude oil prices remained buoyant on Thursday as broad optimism surrounding the crucial UK-EU referendum supported global risk-on rally across global financial markets.

Barring yesterday's move, crude oil prices have been moving in tandem with the broader US equity indices (S&P 500) and long-term (30-years) US treasury yield. Prices have also maintained its inverse relationship with the US Dollar, as measured by US Dollar Index, and the Volatility Index (VIX). A broadly weakening US Dollar and declining VIX is further reinforcing the risk-on trade, supporting up-move in riskier assets - like equities and commodities, including oil.

The black gold, however, now seems to face difficulty in moving back above $50.00 psychological mark barrier as uncertainty over the final outcome of the referendum vote kicks-in. Moreover, a tepid bounce in the US Dollar also seems to cap bullish momentum for the commodity.

Going forward, markets are likely to react with extreme volatility to the actual result, which would probably be available early UK time on Friday. In case of any adverse result would bring a fresh wave of global risk-aversion (rising VIX), spurting demand for traditional safe-haven currency - US Dollar, and severely hurt dollar-denominated commodities - like oil.