The price of crude oil futures rode a surge of positive sentiment in the equities markets higher on Thursday, with lower jobless claims and promising signals in the European economy. The dollar also fell as traders sought out riskier, higher-earning assets, pushing up dollar-priced oil.
On the ICE, the price of West Texas Intermediate light, sweet crude oil futures surged almost 2.2 percent to $78.72 per barrel. That contract hasn’t breached the $80 per barrel line since May, when it plunged from over $90 per barrel to under $72.
Sustained worries about the stability of the economic recovery have weighed on crude oil. Like most other assets, the price of oil has been more subject to day-to-day and week-to-week fluctuations driven by seasonal and ephemeral data rather than long-term considerations.
Oil fell to its lowest point in a week yesterday after government data showed that total inventories of petroleum had hit unexpectedly high levels.
However, it still seems unlikely that a sustained movement in either direction will be impossible to maintain unless the economic bears or the economic bulls get a crystal-clear signal on whether major economies will continue their snail-like climb out of recession or plunge back into a double-dip.
This material is conveyed as a solicitation for entering into a derivatives transaction.
This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.
Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.
You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.