Wednesday, 5 May 2010

EUR/USD at 12-Month High; Crude Oil Falling

Renewed concerns that the Greek debt crisis has yet to be secured helped to send the EUR/USD to a 12-month high. This in turn hurt the price of spot crude oil as crude oil is denominated in US Dollars. As the dollar appreciates in value, crude oil becomes more expensive.

Traders are concerned that a failure of the EU/IMF bailout package to contain the Greek debt crisis will slow European growth and future consumption of crude oil. Rising fears that Spain may also seek aid also weighs heavily on the Euro-Zone.

The remainder of the trading week should be influenced by key data releases. On Friday the U.S. Non-Farm Employment change will be released. A positive outcome for this highly influential economic data piece could spur crude oil buying. The next short term resistance level for spot crude oil rests at $83.00.