Will Crude Oil Reach A 2-Month Low?

By Yan Petters – The sharpest trend that was observed during yesterday’s trading is bearish crude oil. Crude oil has erased almost all of this week’s gains, and has bottomed at $71.52 a barrel. Crude oil is dropping due to concerns that the U.S. economy, the world’s largest oil consumer, is not recovering as fast as it should. Several leading economic publications from the U.S. have recently failed to reach expectations, and it is now commonly agreed that the recovery pace is slower than estimates.

However, this trend might reverse today, as a heavy news day, especially from the U.S. economy is expected.

Here are today’s leading news events:

• 08:30 GMT, British Manufacturing Purchasing Managers’ Price Index (PMI – It is a survey of about 600 purchasing managers who are asked to rate their current business conditions. If the end result will beat expectations for 57.1, the GBP might be supported.

• 12:15 GMT, U.S. ADP Non-Farm Employment Change – It is an estimation of the Non-Farm Payrolls release which is expected by Friday. The ADP forecast is considered to be very reliable, and thus tends to have a large impact on the market. If the end result will be positive, the dollar might be boosted as a result.

• 14:00 GMT, U.S. ISM Manufacturing Purchasing Managers’ Index (PMI) – This indicator is similar to the British one. Analysts have forecasted that the result will be 53.2. A higher result might support the dollar.

Forex Market Analysis provided by ForexYard.

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