The WTI Crude Oil markets fell during the session on Friday, closing just below the $94.00 handle. This area is of course in the middle of a massive cluster that we saw back in November, so it’s a bit difficult start shorting here. This is one of those situations that either you are already short of the market, or you need to stay out. Personally, I believe there still a chance of some type of support in this general vicinity, because a lot of this move was predicated upon Libyans bringing more oil into the marketplace. While that is of course negative for pricing, we have to keep in the back of our mind that liquidity over the past week is been almost nonexistent. Because of this, I am a little hesitant to believe this move, although there is most certainly reasons for the sellers to come out and celebrate.
Nonfarm payroll
For myself, I’m not interested in trading this market until we get the nonfarm payroll numbers. This is because it will dictate what the Federal Reserve may do as far as tapering in the relatively near future. After all, it is the employment situation the people are worried about on the Federal Reserve Board of Governors. If the employment situation picks up in the United States, and continues to go higher, then you have a reason where the Federal Reserve may actually continue to taper off of quantitative easing. However, I think this will actually have the reverse effect of what we normally see. In other words, the higher US dollar will probably go right along with higher prices in the WTI Crude Oil market. This is because more employment would suggest that there would be more demand.
On the other hand, if we get weak jobs numbers coming out of America, it could actually pushes market lower, even though the US dollar would start to fall. That’s because people would be concerned about whether or not the economy really could recover. Nonetheless, I want to see what the employment numbers due to this market before putting on any fresh positions.
