Light Sweet Crude The light sweet crude market fell significantly during the session on Friday, but found enough support at the $40 level to turn things
Light Sweet Crude
The light sweet crude market fell significantly during the session on Friday, but found enough support at the $40 level to turn things back around and form a hammer. This could be a short-term buying opportunity as a relief rally is desperately needed in this market. We have to begin to wonder whether or not the market is an oversold, and you also have to keep in mind that the liquidity out there isn’t going to be that strong as we are close to the end of summer. Most large traders are simply a way of holiday on the beach, and not worried about was going on in the marketplace at the moment. With this, it would not surprise us at all to see this market try to reach towards the $43 level, and then possibly the $45 level. We think that short-term buying opportunity may present themselves. However, if we break down below the $40 level, this market could wind down to the $37.50 level.
Brent
The Brent markets fell during the course of the session on Friday as well, but found $45 to be supportive enough to turn things back around a bit. With that being the case, the market should get a little bit of a bounce but we think that it will only offer selling opportunities, especially near the $50 level. However, we don’t even know if we will get towards the $50 level, as the market is so negative. On the other hand, if we break down below the $45 level, we should then head down to the $42.50 level next. We don’t really have any interest whatsoever in buying this market for any real length of time, but do recognize that a well needed and well-deserved relief rally could happen anytime soon.
With this, we expect a lot of volatility but also recognize that as we are towards the end of the vacation season, the lack of liquidity is without a doubt exacerbating all of the moves that we are seen at the moment.
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.