Crude Oil Forecast Dec. 29, 2011, Fundamental Analysis
Crude oil prices declined on Wednesday amid lack of key economic report from the U.S economy, as debt crisis risks were highlighted after the European Central Bank’s balance sheet rose to a record 2.73 trillion euros since it offered three-year loans to financial institutions last week, replacing optimism on Italy’s 9 billion euros of 179-day bills sold at an debt auction today.
No major data was released from US, Euro Zone or UK on Wednesday, so traders were somehow clueless over the economic recovery. Thereby, European and American equities retreated after the Central Bank’s balance sheet was released.
Traders switched on the holiday mode with the year’s trading nearly complete, so trading volumes ebb down and market movement is pretty stuck within a tight range before the New Year’s holiday, yet with slight punch of cautious optimism. Sentiments will start to shape as investors remain cautious ahead of the New Year’s holiday but traders will be mostly concerned about the latest development from the 17-bloc euro area.
The outlook for crude oil prices remains generally to the downside, as persistent fears from the EU debt crisis and signs global growth is slowing are likely to keep crude oil prices under pressure, where traders will also continue to monitor the developments from the 17-bloc euro nation and the European leaders’ latest moves to contain the debt crisis, where we expect volatility to persist through the sessions this week.