After sharp gains in mid-week, crude oil prices are flat for a second straight day. In the North American session, West Texas Intermediate crude oil futures are trading at $58.35, up $0.02 or 0.12%. Brent crude oil futures are trading at $63.38, up $0.12 or 0.19%. It’s a busy day on the fundamentals front, highlighted by November non-farm payrolls.
Strong U.S. Job Data Could Boost Crude
The U.S. releases key employment indicators later on Friday. Analysts are expecting strong numbers, which could reignite a crude rally. Nonfarm payrolls are projected to increase sharply to 181 thousand, compared to 128 thousand in the previous release. Wage growth is expected to rise from 0.2% to 0.3%. On the consumer front, UoM Consumer Sentiment index is also expected to climb to 97.0, up from 95.7 pts.
In the span of one week, investors have been treated to the strongest swings in crude prices since mid-September. Crude plunged 4.8% on November 29, surprising the markets which had expected a sleepy Friday after Thanksgiving. This decline marked the sharpest 1-day drop since mid-September, when crude took investors on a roller-coaster ride after an attack on Saudi oil terminals. Crude proceeded to recover these losses this week, after climbing 3.8% on Wednesday. This move was caused by an unexpectedly strong drawdown in crude inventories, as well as speculation that OPEC members may cut production in order to reduce a glut of oil on world markets.
With WTI/USD showing little movement, there is no change in the technical breakdown. The pair continues to test resistance at 58.50. Above, we find resistance at 59.25. On the downside, 57.50 is providing support. This is followed by the 200-EMA at 57.03 and the 50-EMA at 56.52. The next support level is at 56.50.
This article was originally posted on FX Empire
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