OANDA - Oil futures commentary

News   •   Oct 27, 2016 01:25 +08

Please attribute the following commentary to Jeffrey Halley, senior market analyst at OANDA. For direct comment, call Jeffrey at +65 9457 1849 or email jhalley@oanda.com

Easy come, easy go overnight as crude gave back all its previous nights gains and then some, with WTI and Brent both dropping 2%. There was no one driver for the price action, a stronger dollar although this hasn't mattered lately; the CEO of Rosneft said he could add 4 million barrels a day if needed, all being mooted.

It smacks of the market fitting news to the price action not vice versa. More then likely we are just seeing profits booked and some risk taken of the table into the weekend, in the absence of any OPEC headlines.

Expect Brent and WTI to dance each side of $51.00 and $50.00 respectively in Asia today. I expect the topside to be heavy as long positions are lightened into the weekend. A drop through $49.00 on WTI in particular should accelerate the flushing out of weak longs into the weekend.