Fed expectations and a curious oil pattern: Here’s what could drive the market on Friday

All U.S. markets closed in the green Thursday after a day full of political events, both domestic and international: Fired FBI director James Comey testified in front of the Senate intelligence committee, U.K. voters headed to the polls to decide its general election, and the European Central Bank decided to keep its benchmark interest rate unchanged.

As the Dow Jones industrial average posted an all-time intraday high and the Nasdaq hit another record close, iiTrader senior market strategist Bill Baruch breaks down three key market themes he is watching.

1. Fed ahead

Next week's Federal Reserve meeting is on Baruch's radar, as it is widely expected the central bank will raise its federal funds target rate. The perceived likelihood for a rate hike, as measured by CME Group's FedWatch Tool, is above 100 percent.

"Today's gantlet of events is quickly going to the rearview mirror, and we expect Treasury prices to reprieve and yields to bump up as we look for a hike next week. It's not uncommon to see this happen ahead of Fed meetings, as the Fed has entered into a tightening cycle," Baruch said Thursday on CNBC's "Trading Nation."

2. WTI TGIF

WTI crude oil has fallen over 5 percent so far this week, on Wednesday logging its largest daily drop in three months as a build in U.S. crude stockpiles surprised the market. Baruch is watching oil's movement on Friday, as he's observed an interesting trend the last several Fridays.

"Oil has bottomed early in Friday's session or finished it in the green for the last six weeks in a row. With the Qatar news in the headlines, look for this trend. And whether you're bullish or bearish you can trade it," he said Thursday.

Several Middle Eastern nations, including oil-rich Saudi Arabia, Egypt and Bahrain, severed diplomatic ties with Qatar earlier this week.

3. Corn shorts shorn

Corn futures have traded in a narrow range over the last two months, Baruch pointed out, and just broke out of resistance this week. He is watching for its price movement heading into Friday trading.

"Funds are near record short. With weather concerns looming, a key U.S. data report tomorrow can confirm this and extend the massive short-covering rally another 7.5 percent," he said.

Corn futures are up over 9 percent year to date.

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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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