RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

As of Thursday afternoon, the October Crude Oil contract was trading around $70 per barrel after trading as high as $70.50 earlier in the day.  The market has been strong lately given a number of developments, including bullish inventory reports, possible Canada & United States trade deal progress, a respite from dollar strength and a number of geopolitical factors including Venezuela, Iran and more.

Moving forward, it will be interesting to see if the highs from this year hold, pictured in the chart below, especially considering outside markets such as the Dollar and equity indices at highs.  For instance, it is worth considering if the equity indices remain at or near all time highs if it will be a bullish, risk on, demand factor.  Also, should the interest rate differentials in the dollar lead to dollar strength, this could be a bearish factor and possibly coincide with a risk off environment.

On the other hand, if the year’s highs hold, it could present an opportunity for those looking at the short side to participate with a swing to the middle of the last half year’s range.  The recent prices and proximity to the year’s highs also may present a good time for hedgers to consider protection.

Crude Oil Oct ’18 Daily Chart

Crude Oil Oct '18 Daily Chart

Michael O'Donnell

Mike started his career in the markets on the floor of the Chicago Board of Trade as a trade checker for a local market maker in the Dow Futures pit. This led to interning with an independent introducing broker and going on to work with a number of market participants including: speculating clients, hedge clients, introducing brokers, futures commission merchants, commodity trading advisors, proprietary traders, trading educators, system creators, and a number of international financial market participants.