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Crude Oil Wrap Up


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Crude Oil has surged the past two days as OPEC was able to overcome difficulties between Saudi Arabia and Iran and get their agreement in place to reduce crude oil production. Production is set to be reduced from Octobers 33.64 million b/d to 32.5 million b/d. This is a cut of just under 1.2 million barrels. OPEC was able to come up with cuts for individual members and allow Iran to freeze production at pre-sanction levels. The Saudis are to cut 500,000 barrels. NOPEC is expected (by OPEC) to cut production by 600,000 barrels. Russia is to cut production by 300,000 barrels (they said they will do it slowly) and Mexico is supposed to cut by 150,000 barrels (they have indicated it isnt going to happen). There is a verification process in place and the agreement is to begin on January 1st. Traders covered shorts on Wednesday and Thursday with a massive wave of buying and I think went long looking for prices to continue higher. A break above the October 19th high (52.22) could lead to a test of 55.00. Support is at 50.00, 49.36 and 48.46.

High 51.80

Low 48.98

Last 50.91

Daily Pivots for 12/2/16:

R2

53.38

R1

52.15

PIVOT

50.56

S1

49.33

S2

47.74


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, December 2 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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