Editor's Note: Due to Hurricane Sandy, there will be no "Futures Now" show on Tuesday, Oct. 30.
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The "Perfect Storm" is pushing the price of crude over the edge.
Crude oiltraded slightly higher Tuesday, with a weaker U.S. dollar relieving demand concerns, and an oversupply caused by Hurricane Sandy. The energy floor at the New York Mercantile Exchange will remained closed for a second-straight session on Tuesday because of Hurricane Sandy, the first two-day weather-related shutdown of the markets since 1888. In turn, volumes will likely be much lighter than usual.
(Read More: How the Decision to Close Wall Street Came About.)
I will continue to look for resistance building against $86.50, as yesterday's high was $86.43. It will be important for oil traders to look for any definitive answer on when refineries could intend to turn back to full production capacity. With a weaker dollar that has seen the U.S. Dollar Index struggle around $80.30, a close back below $80 will help commodity prices ahead of Chinese manufacturing data Wednesday evening. Also, as the storm makes bets on oil less measured as to risk, if oil cannot close below $84.94, it may cause short covering today.
(Read More: Oil Markets Brace for 'Demand Destruction' After Sandy.)
So how am I looking to trade oil right now?
Upon a close below these levels I will be looking to add to short positions, with the next major support level coming in at $82.16. Only a close back above $88 will put this market back into neutral-to-bullish territory.
Read on for 10 Things You Need to Know to Trade Futures
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