Worries about the division between OPEC members remained a major driver of oil prices on Wednesday and drove Brent crude oil (BNO, quote) lower. The commodity traded at $78.73 at 8:45 GMT as investors kept an eye on the cartel’s debate over whether or not to cut supplies at next week’s meeting.
For oil traders and speculators hitting the sell button has become almost automatic, as the heavily bearish tone for the commodity shows no signs of abating just yet, with another solid move lower yesterday offering low risk trading opportunities once again.
It was a day of muted trading for oil yesterday, with both the US and Canada observing a public holiday in honor of their war veterans, and as a result the Wednesday oil inventories report is now scheduled for Thursday.
For longer term oil traders it’s been a question of being patient and waiting, as the commodity continued to consolidate in a narrow trading range, following the extended move lower of early October, which saw the price of oil break through the floor of potential resistance in the $88 per barrel region, before moving down to consolidate in the $79 to $83 per barrel region, where it has remained since.
Brent crude oil (BNO, quote) lost momentum on Monday morning after reports that Goldman Sachs had trimmed its forecasts for crude oil prices.
The last few days have been interesting ones for crude oil (USO, quote) traders, with the commodity mirroring the volatile price action and associated volume profiles of related markets, and suggesting in turn, that we may be approaching a pause, and possible bottom to the current bearish trend.
Let me start this analysis for oil, by highlighting an issue which I always find deeply ironic which is this – when oil prices rise quickly, a hue and cry results with the ‘evil’ speculators blamed who quickly become public enemy number one.
Yesterday’s trading session for commodities was an interesting one to say the least, with oil prices slumping, gold prices whipsawing, and silver prices breaking lower with momentum, as the bears continue to maintain a vice like grip on the market.
It’s been a month of congestion and consolidation for crude oil prices, with the commodity driven by a variety of forces, but as we approach the start of October, the market now appears to be building some momentum in preparation of an imminent breakout. However, much will depend on the deep areas of price resistance now directly ahead.
Brent crude oil (BNO, quote) remained below $97 on Thursday as the growing supply glut continued to outweigh concerns about the conflict in the Middle East.
