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E-Mini Crude Oil Futures Volatility Forecast (05/12/2010)

The E-Mini Crude Oil futures has been really volatile lately and the TGARCH plot highlights very well the great fluctuations that this market experienced.

The price is now around $ 89 and historically speaking the $ 90 threshold has been a very strong resistance. The volatility plot displays a great drop to the 1.5% area (23%annualised) but the very last part of the chart seems to suggest an ulterior rise which could bring back the curve to 2% (31% annualised).

The increase in price of E-Mini Crude Oil futures was artificially created by a short-term recovery of the euro against the dollar. The question arising is obvious: is the Euro going to appreciate against the Dollar?

The staff of HyperVolatility advises you to watch the $ 90 level because an increase in volatility and a failure to break out this resistance would bring the price back down to $ 80.

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