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Hansen: Trading oil's new range
Weekly gains in commodity indices have been driven by strong rallies in US energy markets, notably WTI crude and natural gas. WTI was the best performer, puting on around 5 per cent. The rise was triggered by improved pipeline infrastructure which will help ease congestion inland and make more oil available for Gulf Coast refineries. The discount to Brent narrowed by more than five dollars.
Saxo Bank's Head of Commodity Strategy, Ole Hansen, says we appear now to be in a range of between USD 96 to 100. He says he's looking to sell into that range if we get anywhere near the USD 100 level. He also believes there's not much more upside to Brent above USD 112 per barrel and again, he'd be selling into that.
Ole also considers gold which has fallen again along with silver. Taper talk and rising boyd yields are "not good news" for the sector, he says.
Also of interest is sugar. It's finally seeing some short covering after falling almost non-stop throughout November and early December. He says some "bottom fishing" may now be seen. He says investors contemplating going long should use a stop below the recent low of 16.55 cents per pound while looking for a target of around 17.5 cents.
02:07 minutes
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