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The light sweet crude markets had a negative session on Tuesday after initially trying to rally. The resulting candle for the session was a shooting star, and this suggests to us that perhaps we are going to try and break through the $90 level. However, we suggest that there is a significant amount of support down to the $88 handle, and as such we will not be participating in the selloff.
Quite frankly, we are much more comfortable going long this market once we get the candlestick do show support. We suspect that we should see it over the course of the next couple of days, and will be buying crude oil as a result. We think that the $90 level should be an area that provides enough support that a sizable bounce could be coming.