Crude oil enjoyed an excellent month of December, with gains of 10.5 percent. The markets are quiet after the New Years' holiday, as crude is trading just shy of $61.
Crude is trading quietly on Thursday, as the markets are back in action after the New Year’s holiday. Currently, West Texas Intermediate futures are trading at $60.89, down $0.33 or 0.53%. Brent crude oil futures are trading at $65.98, up $0.02 or 0.03%.
Crude prices are sensitive to the Energy Information Administration (EIA) weekly crude inventory report. Since the markets were closed on New Year’s, the inventory report will be released on Friday. Over the past several months, EIA reports had pointed to a large oversupply of crude, but that trend has shifted lately, with three declines in the past four weeks. The upcoming report is also expected to show a decline, with a forecast of -3.1 million barrels. If the estimate is within expectations, we could see upward pressure on crude prices on Friday.
On the upside, crude may find it difficult to move higher, as there are some nearby resistance barriers to contend with. On the upside, the line of 61.00 remains fluid. There is a major Fibonacci level at 62.05, followed by resistance at 62.25. Above there is resistance at 63.25. On the downside, there is support at 59.75.
Kenny is an experienced market analyst, with a focus on fundamental analysis. Kenny has over 15 years of experience across a broad range of markets and assets –forex, indices and commodities.
