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Crude Oil Price- Nov. 25, 2013

By Christopher Lewis
Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.

The WTI Crude Oil markets spent the majority of Friday falling, but did get enough of a bounce from the $94 level in order to form a hammer. This is of course a bullish sign, and the market looks as if it wants to go higher as a result. However, I am a bit hesitant to go long at this point as the $96 level has a gap, which of course should be resistance as well.

The market will continue to have a bit of weight upon it, as the downtrend has been so strong. The sellers should still be in control overall, and the buying of this contract is going to be a short-term move in general. The market could have a nice bounce though, and I think that it could go as high as $98.50 if we get above the $96 level first

The Federal Reserve and the US dollar

The Federal Reserve and whether or not it can taper is the biggest question that the markets are looking into at the moment, and this will certainly be the case with oil as well. The employment situation is the driver of this decision in general, and as a result paying attention to the Non-Farm Payroll numbers will be paramount. The stronger the numbers, the more likely the Fed can taper, which will drive the value of the Dollar higher, and this could very easily drive the value of oil lower. 

The support level below will be tough to break though, and because of this I think that the market will have to hear “taper” from the Fed in order to get below the $90 level for any real length of time. The $98.50 level should be resistive, but even that could be overcome in the end as the market would head towards the $100 level next. Regardless, this market would more than likely continue to chop around overall, and as a result I would be more willing to play both sides of the market via the options markets in order to take advantage of the volatility. 

Crude Oil 112513

Christopher Lewis
Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.

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