The WTI Crude oil futures are expected to edge up after recording losses for last four consecutive sessions as bargain buying supported the commodity. The late pick up in Euro on Friday could also benefit the commodity. The US dollar jumped to a high of 1.2875 on Friday, the pair’s lowest since November 22 after the the US Department of Labor said the economy added 146000 jobs in November, beating forecasts for an increase of around 100000. The unemployment rate droppedto 7.7%, an almost four year low from 7.9% in October. However, the massive gains in dollar faded as traders eyed the details in Non farm. The rather unexpected drop in the unemployment rate was attributed to more people dropping out of the labor force, while previous month’s gain of 171,000 was revised down to 138,000. Euro had slipped earlier in the week as the the European Central Bank left its interest rates unchanged at 0.75% but weak economic outlook hurt the currency. European Union countries' collective gross domestic product shrank by 0.1% in the third quarter, from the previous quarter, and was down 0.6% from the same period last year. EU businesses curtailed their investment and drew down their existing stockpiles in the three months ending in September. Most believe the EU will continue its economic contraction at least into the fourth quarter of 2012. Meantime, Greece's unemployment rate rose to 26% in September, from 25.3% in August, it was reported Thursday. Further, media reports revealed that Euro zone countries would lose the right to set their own budgets and end up surrendering economic sovereignty to Brussels under a blueprint to "complete" the European Union's single currency. A master plan for "completion of economic and monetary union" has been set out in a confidential document to be discussed by EU leaders at a Brussels summit next week. Earlier in the week, a surge in US gasoline inventories kept crude under check after the commodity-tested highs above $89 per barrel in last week. The weekly US EIA data showed a massive rise in gasoline stockpiles in the United States last week. An increase in production by US refiners helped boost gasoline inventories by the biggest weekly margin since September 2001, the EIA said, with stocks rising by 7.9 million barrels. WTI Crude fell to its 10 day low levels, testing lows under $86 on two occassions and closed at $85.92 per barrel. The counter needs to break above $86 per to witness further gains but is unlikely to surge much given than the 100 day Expoential Moving Average (EMA) reamins well above the current levels and the commodity failed to hold on to a rally towards the EMA 100 mark on last Monday. The MCX Crude oil futures fell from a high of Rs 4999 on last Monday to test lows of 4730-40 on three consecutive sessions. There has been heavy rollover owing to the expiry of the near month futures. Further gains are likely from hereon but overall bias remains rather negative.
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