Oil prices plunged more than $5 in a few minutes on Monday afternoon as
volumes spiked in a rapid sell-off, sending Brent crude crashing through
technical support as markets sought an explanation for the plunge.
Brent crude oil [LCOCV1
113.50
-3.16
(-2.71%)
]
sank from $115.20 a barrel at 1:52 p.m. in $111.60 three minutes later
as trading volumes — which had been muted by the Rosh Hashanah holiday —
shot up. Brent crude later pared losses to settle $2.87 lower at
$113.79 a barrel.
It was not immediately clear what caused the crash, but traders said it
could have resulted from a problem with a computer trading program.
TRADING ROBOT'S MADE THE SCAPE GOAT THIS TIME ?
CME Group,
the parent company of the New York Mercantile Exchange, said it was not
immediately aware of any technical issues that might have triggered a
sharp sell-off in U.S. crude oil futures on Monday afternoon, a CME
spokesman said.
"I've been doing this for 14 years and that's
the fastest move I've ever seen,'' said John Gretzinger, an energy risk manager at INTL-FCStone in Kansas City. "I think it was too fast to be
anything but HFT (high-frequency trading) or other logos. We just don't
know right now, but that's my gut feeling.''
Protests
continued over a film mocking the Prophet Mohammad that has unleashed a
wave of anti-Western sentiment in the Muslim and Arab region, keeping
worries about disruptions to oil supplies in focus.
"Any
breakdown in law and order in the Middle East or North Africa is
potentially bullish for oil as it could impact on production," said
Olivier Jakob, an energy market analyst at Petromatrix in Zug, Switzerland.
OF'COURCE WE ARE IN A NEAR TERM BULLISH TREND ...(so we are immediately bouncing back sharply From dips , operation flush out) BUT THE CORRECTION WAS MUCH NEEDED ...AS WE ARE IN LONG TERM BULLISH TREND & THE GAP FILLING WAS NECESSARY FOR PRICES TO MAKE A HIGHER HIGH TAKING OUT THE RECENT / PREVIOUS HIGH ''WTIC $115'' & TARGETING HIGHER $123...
TECHNICAL BOYS & TRADER'S LATE LONG OR SO CALLED DISCIPLINED POSITIONS AS PER TREND & TECHNOLOGY GETTING THEIR STOP'S HIT ACCORDINGLY ?
Let's call it
'' From Obvious to Reality'' or ''Trading Thoughts'' ?
''When the prices need to RISE whatever the news , fundamentals , Technical Indicators signals are ... Markets takes it as positive ...When Needs OR due for a Correction .. The Positive Out come will Also be taken as Negative By the Markets''
THIS IS HOW THE MARKET'S WORK !
