CL Redux
- Thread starter schizo
- Start date
If the moves in EURUSD and GBPUSD are anything to go by, then there should be more to come. Gold is has been slammed 18 bucks as i type this.
The NFP wasn't THAT good - but the dollar strengthening argument is determining other market movements today
Why should the jobs mkt keep up a steady improvement? Was that true before it dropped? Is not that a utopian opinion?
PS: the Fed can NOT determine the value of the dollar, that is a macro situation. That is why central bank intervention on the value of said currency always FAILS.
Very true millions of jobs aren't coming back but some people learn to do something else. Sorry this had nothing to do with oil.
Ummm sell short at this mornings POC around 107.05
Short 107.88 , stop 108.06
LONDON (Reuters) - Oil prices cut back gains of over a dollar on Friday after stronger-than-expected U.S. jobs data indicated the improving economic recovery of the world's largest oil importer was firmly on track, boosting the dollar.
Although a stronger recovery should lead to increased demand for crude, the data sent the dollar higher amid expectations the U.S. may move away from its current ultra-loose monetary policy which tends to benefit riskier assets like commodities.
A stronger dollar can also weaken dollar-denominated oil prices because it increases the price of oil for consumers using other currencies.
U.S. crude futures were 17 cents higher at $106.89 at 1333 GMT after earlier climbing to $107.84, a level last touched in September 2008. Brent crude for May delivery rose 2 cents to $117.38, the highest level in nearly four weeks.
"There are two opposing factors here," said Thorbjoern Jensen, analyst at Global Risk Management. "This data should be bullish for oil but the dollar effect and the rate effect is taking the steam out of it."
Payrolls showed a total of 216,000 nonfarm U.S. jobs were added in March, the government said, well above the 190,000 expected in a Reuters poll.
A growing economy will encourage Federal Reserve chairman Ben Bernanke to shift his focus toward inflation, increasing the potential for an interest rate hike which would further strengthen the dollar.
John Kilduff, partner at Again Capital LLC in New York, said the mixed reaction to the data was unsurprising.
"Crude may not react very much to the improving employment data, as the reading may stabilize the dollar and allow the Federal Reserve to further signal a pullback from its aggressively loose monetary policy," he said.
"While increased employment should help energy demand, there are greater forces at work in the commodity sector."
Although a stronger recovery should lead to increased demand for crude, the data sent the dollar higher amid expectations the U.S. may move away from its current ultra-loose monetary policy which tends to benefit riskier assets like commodities.
A stronger dollar can also weaken dollar-denominated oil prices because it increases the price of oil for consumers using other currencies.
U.S. crude futures were 17 cents higher at $106.89 at 1333 GMT after earlier climbing to $107.84, a level last touched in September 2008. Brent crude for May delivery rose 2 cents to $117.38, the highest level in nearly four weeks.
"There are two opposing factors here," said Thorbjoern Jensen, analyst at Global Risk Management. "This data should be bullish for oil but the dollar effect and the rate effect is taking the steam out of it."
Payrolls showed a total of 216,000 nonfarm U.S. jobs were added in March, the government said, well above the 190,000 expected in a Reuters poll.
A growing economy will encourage Federal Reserve chairman Ben Bernanke to shift his focus toward inflation, increasing the potential for an interest rate hike which would further strengthen the dollar.
John Kilduff, partner at Again Capital LLC in New York, said the mixed reaction to the data was unsurprising.
"Crude may not react very much to the improving employment data, as the reading may stabilize the dollar and allow the Federal Reserve to further signal a pullback from its aggressively loose monetary policy," he said.
"While increased employment should help energy demand, there are greater forces at work in the commodity sector."