Crude oil was little changed today, largely due to the low liquidity seen in the marketplace following the Christmas holiday. While the commodity saw a brief spike in prices earlier, peaking at 91.65, it has since dropped back to its earlier levels. Currently crude oil is trading just above 91.30. Analysts are currently in agreement that while oil could spike and fall in the coming days due to low market volatility, no significant change is expected.
That being said, traders will want to pay attention to the movements of the major currencies in the days ahead. Oil typically rises and falls with the movements of the euro and US dollar. With the euro currently down because of the recent Irish debt crisis, it is not out of the question that crude oil could fall well below the 91.00 level ahead of the new year.
In addition, traders will want to pay attention to Thursday’s US Crude Oil Inventories figure. Currently analysts are predicting an increase in US stockpiles. Typically this means that oil prices would go up due to an increased demand. While this very well could occur, no one is really sure what could happen in this market environment.
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Dan Eduard is a Market Strategist with ForexYard. His addition to the ForexYard team has brought a unique new perspective to our clients. Dan's ability to compare and contrast trans-national issues with events in the market is uncanny and many clients so far have used his advice to make leaps and bounds in their trading strategies. He has been published on the ForexYard Trading Blog and affiliate websites. He carries a BA in Political Science and an MA in History.
