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5 Jan 2015
Oil dives deeper into red, reaches fresh 5-1/2 year lows
FXStreet (Mumbai) - Crude oil prices on both the sides of Atlantic, extended losses from the previous session and dropped to fresh five and a half year lows after persistent oversupply worries kept the investors on the short side of the trade.
Currently, Brent oil trades at USD 55.46/ barrel and WTI oil traded at 51.72, both losing over 1.75% on the day. Crude oil prices reached fresh five and a half year lows today after Sanford C. Bernstein, US based global asset management firm, cut its Brent forecasts for this year amid “supply strength, lower-than-expected demand together with spare capacity and inventory increases” seen in 2014. Oil prices came under further pressure after the US dollar index, measuring the relative strength of the greenback against a basket of six major currencies, jumped 0.35% to multi-year highs at 91.80 levels.
In the week ahead, investors will be turning their attention to Friday’s U.S. nonfarm payrolls report for further indications on the strength of the recovery in the labour market. Wednesday’s Federal Reserve meeting minutes will be also closely watched.
Crude Oil Technical Levels
Brent oil has an immediate resistance which stands at 56.28 (Jan 4 High), above which gains could be extended to 58.54 (Jan 2 High) levels. Meanwhile, support is seen at 55 levels from here losses could be extended to sub 53 levels.
Currently, Brent oil trades at USD 55.46/ barrel and WTI oil traded at 51.72, both losing over 1.75% on the day. Crude oil prices reached fresh five and a half year lows today after Sanford C. Bernstein, US based global asset management firm, cut its Brent forecasts for this year amid “supply strength, lower-than-expected demand together with spare capacity and inventory increases” seen in 2014. Oil prices came under further pressure after the US dollar index, measuring the relative strength of the greenback against a basket of six major currencies, jumped 0.35% to multi-year highs at 91.80 levels.
In the week ahead, investors will be turning their attention to Friday’s U.S. nonfarm payrolls report for further indications on the strength of the recovery in the labour market. Wednesday’s Federal Reserve meeting minutes will be also closely watched.
Crude Oil Technical Levels
Brent oil has an immediate resistance which stands at 56.28 (Jan 4 High), above which gains could be extended to 58.54 (Jan 2 High) levels. Meanwhile, support is seen at 55 levels from here losses could be extended to sub 53 levels.