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Crude Oil Wrap Up


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Thursday, November 17, 2016 was rollover day in Crude Oil. The January contract became the lead contract over the December contract as its volume surpassed the December contract. The December contract expires on Monday, November 21. Thursdays early action saw January Crude Oil test resistance up at 4717 (50 DMA) reaching 47.12. Bulls couldnt maintain the momentum and Crude Oil spent the rest of the session in retreat. Crude Oil settled at 45.98 and continued lower after settlement making the low of the day at 45.47 and it ended the session at 45.50. With three days of short covering after making its low (42.20) for the move on Monday on constant headline grabbing statements from OPEC, crude oils current supply glut won the day over a possible OPEC agreement to cut production. A strengthening US Dollar also played a big role in the days decline. With crude oil inventories increasing again last week it is going to take a strong, verifiable commitment from OPEC on production cuts to bring about a reduction in the supply glut. Then to maintain the lower production levels, OPEC will need cooperation from NOPEC (Russia mostly). They also need US producers to stay out of the way (fat chance). If Crude Oil breaks down below the Thursday low (45.47) price may test support at the 13 DMA (44.84) and then the 200 DMA (43.98). A rebound off the low could lead to a test of resistance at the 100 DMA (46.08), the 21 DMA (46.39), and then the 50 DMA (47.17).

High 47.12

Low 45.47

Last 45.50

Daily Pivots for 11/18/16:

R2

47.68

R1

46.59

PIVOT

46.03

S1

44.94

S2

44.38


If you are interested in a Managed Futures program for Crude Oil, check out this offering from Walsh Trading:

Walsh Asset Management Introduces Bluenose Capital

For those interested I hold a weekly livestock webinar on Friday, November 18 at 2:30pm. It is free for anyone who wants to sign up and the link for sign up is below. If you cannot attend live a recording will be sent to your email upon signup.

Sign Up Now

Ben DiCostanzo

Senior Market Strategist

Walsh Trading, Inc.

Direct: 312.957.4163

888.391.7894

Fax: 312.256.0109

bdicostanzo@walshtrading.com

www.walshtrading.com

RISK DISCLOSURE: THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES AND OPTIONS TRADING. THIS REPORT IS A SOLICITATION FOR ENTERING A DERIVATIVES TRANSACTION AND ALL TRANSACTIONS INCLUDE A SUBSTANTIAL RISK OF LOSS. THE USE OF A STOP-LOSS ORDER MAY NOT NECESSARILY LIMIT YOUR LOSS TO THE INTENDED AMOUNT. WHILE CURRENT EVENTS, MARKET ANNOUNCEMENTS AND SEASONAL FACTORS ARE TYPICALLY BUILT INTO FUTURES PRICES, A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES AND OPTIONS CONTRACTS.



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About the author


Ben DiCostanzo
Senior Market Strategist
Walsh Trading

I began my career in the Securities industry working as a runner on the floor of the New York Stock Exchange while I attended Pace University. I then started working for Salomon Brothers in their Government Bond Trading arena. After graduating from Pace University with a degree in Accounting, I transferred to Chicago and became a member of the Chicago Mercantile Exchange utilizing my experience to execute trades and manage risk for institutional clients as a broker for Salomon Brothers on the trading floor. I then embarked to trade for my own account in the stock indices pits as a local before moving off the floor to aid and assist individual clients in their trading endeavors. I now work at Walsh Trading holding a series 3 broker’s license whose duties include being the firm’s Chief Market technician.

I understand that every client's needs are different, and I pride myself in tailoring my service to each client's unique circumstances and needs. Individual client experience, risk tolerance, and capital all play a role in how I approach the markets. I am involved in all markets using technical analysis to find opportunities. My approach is driven by the principles of capital preservation.

My trading philosophy is that if you can recognize and manage the risk, you have a better chance to be successful in trading. I advise clients to always use stops as money management in my opinion is the most important ingredient in trading commodities.

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