Due to the recent volatility in prices in oil trading, traders may profit greatly by anticipating their market direction. Volatility, in terms of financial instruments, is described as an expected movement in asset prices in either direction.
The volatility of the oil is assessed in proportions. For instance, with the present oil price at $100 and volatility at 15%, traders predict that the price of oil will vary by 15% in the next year (up to either $85 or $115).
Price volatility is expected to rise in the future if the current volatility exceeds historical volatility. As long as the current volatility level stays below the long-term average, traders may expect that future market moves will bring less volatility. [Read more…] about Oil trading market volatility and how to gain high profit rate