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Crude Oil Forecast August 29, 2016, Technical Analysis

By:
Christopher Lewis
Published: Aug 27, 2016, 04:59 UTC

WTI Crude Oil The WTI Crude Oil market rose during the day on Friday again, as we continue to see buyers enter this market every time it pulls back. With

Crude Oil daily chart, August 29, 2016

WTI Crude Oil

The WTI Crude Oil market rose during the day on Friday again, as we continue to see buyers enter this market every time it pulls back. With this being said, I believe that the market will continue to try to grind its way towards the $50 level, and therefore I am bullish. I also recognize that there will be a lot of volatility though, and that this won’t necessarily be the easiest market to deal with over the next couple of weeks as liquidity will be an issue. However, the buyer seems to be in control so there’s really no way to fight them until we get well below the $46 level which has been so reliable lately. I believe that the $50 level will offer a bit of psychological resistance obviously, sell at this point in time expect short-term use only.

 

Brent

Brent markets of done much the same as we continue to grind away above the $50 level. I believe that this market will continue to go higher as well, as it seems like the anti-dollar and pro-petroleum trade is on. There’s a lot of talk about a lack of drilling next year, and that of course could explain some of this explosive move to the upside, but at the end of the day you have to worry about demand as well, and that could cause violent pullbacks. Nonetheless, technically speaking this is a very bullish chart subtlety reason why you would start selling anytime soon. I believe that the $40 level has been acting as a very reliable support barrier, so this point in time as long as we are above there I have no interest in selling at all. Pay attention to the US dollar, if it starts to strengthen that could turn this market back around, but as long as it remains relatively soft, I believe that we will continue to see quite a bit of bullish pressure in both of the petroleum markets as they tend to be very sensitive to the value of the greenback.

Brent daily chart, August 29, 2016
Brent daily chart, August 29, 2016

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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