Crude Oil Rises Near Three Month High on Europe Sentiment and U.S. Inventories

Crude oil rose to its highest in more than three months in New York as falling unemployment applications and decreasing crude supplies in the U.S. bolstered confidence that demand will remain supported.

Futures extended gains after the Labor Department said that jobless claims fell by 10,000 to 390,000 in the week ended Nov. 5., the lowest level in seven months. Oil had already gained after Italy met its fund raising target in a Treasury bills auction. The International Energy Agency reduced forecasts for global oil demand in 2012 for a third month on weaker prospects for developed nations.

“It’s quite bullish at the moment in the oil market,” said Gerrit Zambo, a trader at Bayerische Landesbank in Munich. “But the bullish sentiment can easily turn again if we see markets crashing further due to the Italian situation”.......Read the entire Bloomberg article.

Crude Oil Heads for Weekly Decline on Forecast for U.S. Jobless Increase

Crude oil declined, headed for a weekly drop, amid forecasts that a U.S. government report will probably show the jobless rate rose in August for the first time in four months, signaling a recovery in fuel demand may falter. Futures gave up some of yesterday’s 1.5 percent gain as analysts estimated the August payrolls report from the Labor Department may show the U.S. economy lost 105,000 jobs, according to a Bloomberg survey. Crude gained yesterday after an explosion on a Gulf of Mexico oil and gas platform prompted speculation that tighter regulations will cut production.

“Trading is volatile,” said Peter McGuire, managing director at CWA Global Markets Pty in Sydney. “People are still sitting on the sidelines waiting for the unemployment numbers.” The October contract fell as much as 48 cents, or 0.6 percent, to $74.54 a barrel in electronic trading on the New York Mercantile Exchange, and was at $74.69 at 2:53 p.m. Singapore time. Yesterday, it gained $1.11 to $75.02. Futures are 0.6 percent lower this week and down 5.9 percent this year.

“The market will turn to payroll numbers tonight with expectations of a headline fall of 105,000 and a rise in the unemployment rate to 9.6 percent,” Mark Pervan, head of commodity research at Australia & New Zealand Banking Group Ltd. in Melbourne, said in an emailed note today.....Read the entire article.

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Crude Oil Rises for Second Day on U.S. Jobless Claims Report

Crude oil rose the most in more than three weeks as applications for U.S. unemployment benefits dropped more than forecast, easing concern about the labor market amid other signals the economy is slowing. Oil jumped as much as 2 percent after the Labor Department in Washington reported initial jobless claims fell for the first time in a month in the week ended Aug. 21. The Standard & Poor’s 500 Index fluctuated after yesterday’s gain and the dollar fell against the euro, boosting commodities as an alternative investment.

“The four horsemen that matter to oil are all galloping in the same direction today, with a stronger stock market, weaker dollar, better than expected jobs and lower Cushing inventories,” said Adam Sieminski, chief energy economist at Deutsche Bank AG in Washington. Crude oil for October delivery rose $1.01, or 1.4 percent, to $73.53 a barrel at 11:34 a.m. on the New York Mercantile Exchange. Futures have dropped 11 percent since Aug. 3. They have risen 2.9 percent in the past year.

Jobless claims declined by 31,000 last week to 473,000. The median estimate of 48 economists surveyed by Bloomberg News forecast the figure would drop to 490,000. The S&P 500 gained 0.72 points to 1,056.05. The Dow Jones Industrial Average fell 2.2 points to 10,057.86. The dollar traded at $1.2706 per euro, down 0.4 percent from $1.2659 yesterday. The Reuters/Jefferies CRB Index of 19 commodities advanced 0.8 percent to 263.99, the first increase in seven days. Seventeen of the commodities gained, led by copper, heating oil and gasoline.
....Read the entire article.

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Crude Oil Falls After U.S. Jobless Claims Climb to Three Month High

Crude oil fell for a second day after the number of Americans filing applications for unemployment insurance climbed to a three month high, bolstering concern that the economic recovery is slowing. Oil slipped 0.6 percent after the Labor Department reported that initial jobless claims increased by 19,000 to 479,000 last week, the most since April. A U.S. Energy Department report yesterday showed that crude oil supplies in the Midwest surged to a record as nationwide fuel stockpiles rose.

“The economic data doesn’t bode well for oil demand,” said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. “It’s hard to justify oil near $82 a barrel with the economy struggling.” Crude oil for September delivery declined 46 cents, or 0.6 percent, to settle at $82.01 a barrel on the New York Mercantile Exchange. Futures are up 14 percent from a year ago. Brent crude oil for September settlement fell 59 cents, or 0.7 percent, to end the session at $81.61 a barrel on the London-based ICE Futures Europe exchange.

Economists forecast claims would fall to 455,000, according to the median of 43 projections. Estimates ranged from 444,000 to 470,000. The government revised the prior week’s total to 460,000 from a previously reported 457,000. The country’s jobless rate rose to 9.6 percent last month from 9.5 percent in June, according to a Bloomberg survey before a Labor Department report tomorrow. “We turned lower once the jobs report was released,” said Tom Bentz, a broker at BNP Paribas Commodity Futures Inc. in New York. “There hasn’t been a lot of momentum. We just appear to be giving back some of our recent gains”.....Read the entire article.

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Crude Oil Is Steady as U.S. Trade Deficit, Jobless Claims Drop

Crude oil was little changed along with the dollar after U.S. government reports showed that the country’s trade deficit narrowed, indicating a slowing economic recovery, and jobless claims decreased. Oil fluctuated as the U.S. currency changed direction against the euro on the conflicting economic news. The strength of the dollar has guided commodity prices over the past three years as investors look at raw materials as a store for value. U.S. equities were little changed.

“We aren’t doing much because the dollar is consolidating and equities have been covering the same ground for the last three days,” said Peter Beutel, president of trading adviser Cameron Hanover Inc. in New Canaan, Connecticut. “There’s a consensus that the economy is growing, but also a great deal of uncertainty about the strength of the recovery.” Crude oil for April delivery increased 2 cents to $82.11 a barrel on the New York Mercantile Exchange, the highest settlement price since Jan. 11. Futures are up 94 percent from a year earlier.

The dollar traded at $1.3677 against the euro, down 0.2 percent from $1.3657 yesterday. The Standard & Poor’s 500 Index gained 4.63, or 0.4 percent, to 1,150.24. The S&P 500 dropped as much as 0.6 percent earlier today. The index has risen 1 percent so far this week. “We don’t trade on oil-market news anymore, instead we look at what’s happening with the stock market and dollar,” said Addison Armstrong, director of market research at Tradition Energy in Stamford, Connecticut.....Read the entire article.


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Oil Falls After U.S. Reports Drop in Retail Sales, Higher Jobless Claims

Crude oil fluctuated as U.S. retail sales unexpectedly weakened and jobless claims rose, indicating that the economy will be slow to recover. Oil extended its longest decline in a month as sales at U.S. retailers slipped 0.3 percent in December, after a 1.8 percent jump in November, according to the Commerce Department in Washington. Weekly jobless claims climbed 2.5 percent, the most in five weeks, the Labor Department said. “It’s getting more and more difficult to maintain prices at around $80, though last week it seemed like it was going to be the floor,” said Michael Fitzpatrick, vice president of energy at MF Global in New York. Prices are likely to trade in a $70 to $80 range without “incontrovertible signs that the economy is improving.”

Crude oil for February delivery fell 17 cents to $79.48 a barrel at 12:16 p.m. on the New York Mercantile Exchange. Crude prices have more than doubled in the past year, reaching a 15- month high of $83.95 on Jan. 11. Oil fell as much as 0.9 percent and rose as much as 0.9 percent today. Oil settled below $80 a barrel yesterday for the first time this year, after a U.S. government report showed the country’s crude and fuel inventories increased last week. Crude has declined 5.3 percent from the Jan. 11 high.

February crude oil options expiration at the end of the trading day is making futures volatile, analysts said.....Read the entire article.

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Crude Oil Lower On Demand Concerns and Jobless Claims

June crude oil was lower due to profit taking overnight as it consolidates some of the rally off April's low. Stochastics and the RSI are overbought and are turning bearish signaling that a short term top might be in or is near.

Closes below the 20 day moving average crossing at 53.35 are needed to confirm that a short term top has been posted.

Crude oil is struggling against a slightly higher dollar and worse then expected jobless claims and unemployment data.

If June renews this spring's rally, the reaction high crossing at 65.00 is the next upside target.

Thursday's pivot point, our line in the sand is 58.34

First resistance is Tuesday's high crossing at 60.08
Second resistance is the reaction high crossing at 65.00

First support is the 10 day moving average crossing at 56.54
Second support is the 20 day moving average crossing at 53.35

10:30 AM ET. May 8

EIA Natl Gas Inventories, in billion cubic feet

Total Working Gas in Storage (previous 1918)

Total Working Gas in Storage (Net Change) (previous +95)

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The June Dollar was higher overnight due to short covering as it consolidates around the 75% retracement level of the December-March rally crossing at 827.50. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term.

If June extends the decline off April's high, the 87% retracement level of the December-March rally crossing at 81.49 is the next downside target. Closes above the 10 day moving average crossing at 83.44 would temper the near term bearish outlook in the market.

First resistance is the 10 day moving average crossing at 83.44.
Second resistance is the 20 day moving average crossing at 84.62.

First support is Wednesday's low crossing at 81.98.
Second support is the 87% retracement level crossing at 81.49.

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The June S&P 500 index was lower overnight and tested support marked by the 20 day moving average crossing at 878.09. The pre market trading session is trying to digest worse then expected jobless and unemployment numbers so it is no surprise that Stochastics and the RSI have turned bearish signaling that sideways to lower prices are possible near term.

We are looking at a trading range of 880 - 887 and traders are looking closely at the 50% retracement level of 875.75 to go long.

Closes below the 20 day moving average crossing at 878.09 would confirm that a short term top has been posted while opening the door for a larger degree decline this spring. Closes above the 10 day moving average crossing at 901.50 would temper the near term bearish outlook in the market.

Thursday's pivot point, our line in the sand is 892.25

First resistance is the 10 day moving average crossing at 904.50
Second resistance is last Thursday's high crossing at 924

First support is the 20 day moving average crossing at 873.75
Second support is the 25% retracement, this spring's rally crossing at 861.50

First weekly support is 891.50

The June S&P 500 Index was down 2.00 points. at 883.30 as of 6:06 AM CST. Overnight action sets the stage for a lower opening by the June S&P 500 index when the day session begins later this morning.


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