Crude Oil forecast for the week of August 3, 2015, Technical Analysis

Light Sweet Crude

The light sweet crude market went back and forth during the course of the week, testing the $50 level for resistance, and then falling well below the $47 level during the session as well. Ultimately, we ended up forming a shooting star which signals that we will probably continue to go lower. With this, the market should then reach towards the $45 level, and then the $42 level after that. We have no interest in buying, and we think that anytime this market rallies there should be a nice selling opportunity involved, and as a result we believe that the markets simply will continue to produce profits for the sellers, if you can wait long enough. We believe that the markets will continue to suffer at the hands of a stronger US dollar, as well as lack of demand out of places like China.

 

Brent

The Brent market fell below the $54 level, and now has made a fresh, new low. Because of this, we believe that the market will continue down towards the $50 level fairly soon, and cannot be bought at this point. Quite frankly, we are closing at the very bottom of the range, and that of course is a very negative sign. With that, continuation should be the way going forward and we think that the markets will offer plenty of selling opportunities every time we rally. The US dollar simply far too strong for the Brent markets to continue going higher, but we do recognize that eventually bounces will happen from time to time.

Ultimately, the markets are far from turning around, and as a result we just simply ignore buying opportunities even if the present themselves in the meantime. The only way we could go long of this market as if we get some type of longer-term buy signal on perhaps a monthly chart. In the meantime, we continue to favor the US dollar over commodities in general, and of course Brent will be any different at this point in time.