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The light sweet crude markets rose again during the Wednesday session in order to form a hammer for the second day in a row. This is impressive because of the fact that we have continually ground our way higher towards the $90 level, which of course we have is major resistance.
Because of this, we feel that the oil markets will continue higher but we need to see the $91 level or so be taken out in order to be completely comfortable buying at this point. If you're getting along of the crude oil markets at this point in time, you are definitely chasing the trade which is a recipe for disaster. However, having said that we think that this market will more than likely make a move towards the $100 level if we can get above $92.
As for selling, we think that a break below $84 will be necessary to do that at this point in time as we have seen such solid strength over the last week or so. Once we get below $84, we think that 78 will be the target though.