22 Oct 2013
Oil, gold tread water ahead of NFP
FXstreet.com (Athens) – Oil continues to set up the bearish tone on Tuesday, after having already broke decently the $100 figure, while gold heading downwards at 1312 area.
US Crude Oil is moving constantly below $100/brl (down 1.68%) for a second consecutive day (apart from – yesterday - crude oil price below $100/brl was last seen at the 3rd July as of 2013), while Brent Oil is moving north at $110.23/brl (up 0.40%). Briefly, crude oil is trading at 98.78 down 0.37%, having overcome the barrier as of 98.99 (September 2012 top). On the other hand, gold is consolidating at lower levels, around $1312/ounce (down 0.27%). Market participants could attribute the commodities downtrend, to the fact that investors are waiting for the widely anticipated NFP-data. Elaborating on, a strong reading on the NFP data would lead to the suggestion that tapering will come “sooner” than “later”, strengthening the American dollar and ‘punishing’ the commodities. Yesterday, data from the U.S. Energy Information Administration for the week to October 11, which was delayed until Monday by the government shutdown, showed a 4 million barrel build in domestic stockpiles for the week. It also showed Cushing stocks rose by 366,000 barrels after 14 weeks of decline. All in all, Morgan Stanley suggests “that a sustained weak dollar will support oil prices as it makes dollar denominated oil cheaper to acquire”.
US Crude Oil is moving constantly below $100/brl (down 1.68%) for a second consecutive day (apart from – yesterday - crude oil price below $100/brl was last seen at the 3rd July as of 2013), while Brent Oil is moving north at $110.23/brl (up 0.40%). Briefly, crude oil is trading at 98.78 down 0.37%, having overcome the barrier as of 98.99 (September 2012 top). On the other hand, gold is consolidating at lower levels, around $1312/ounce (down 0.27%). Market participants could attribute the commodities downtrend, to the fact that investors are waiting for the widely anticipated NFP-data. Elaborating on, a strong reading on the NFP data would lead to the suggestion that tapering will come “sooner” than “later”, strengthening the American dollar and ‘punishing’ the commodities. Yesterday, data from the U.S. Energy Information Administration for the week to October 11, which was delayed until Monday by the government shutdown, showed a 4 million barrel build in domestic stockpiles for the week. It also showed Cushing stocks rose by 366,000 barrels after 14 weeks of decline. All in all, Morgan Stanley suggests “that a sustained weak dollar will support oil prices as it makes dollar denominated oil cheaper to acquire”.