Nymex crude prices bounced higher yesterday after falling ahead of the FOMC. The announcement that interest rates would be held down close to zero until 2014 at the earliest, and the spectre of QE3 as early as next month, led a huge risk rally which undid the slide in euro and gold following a raft of negative comments out of Davos. The EIA reported a 3.56 mmbl build in crude inventories which was over double analysts expectations and initially led the contract to the day’s lows of $97.53 from opening levels of $99.20, but this was quickly undone on fears of refinery disruptions, and the FOMC. A strong bounce to $100.40 was then seen before closing out the session at $99.40. Gold broke through the psychological $1700 level which also added to the bullish crude sentiment. Asian markets this morning have seen a consolidation in the overall risk rally with prices again buoyed by and the contract pushing back up again through $100 to $100.17. Support today is at $98.63 and $97.86 with resistance up at yesterday’s highs of $100.40 and $100.94
EasyForexNews Research Team