Crude Oil forecast for the week of August 31, 2015, Technical Analysis

Light Sweet Crude

The light sweet crude market as you can see initially fell all the way down to the $38 level, but found enough support to turn this market back around and slammed into the $46 level. If we can break above the $46 level, this market should easily reach towards the $50 level at that point in time. We believe that this market has turned back around for a reasonable bounce at this point in time. Ultimately, the market looks as if it is oversold, and as a result this bounce is going to be needed. Quite frankly, we feel that the oil markets are been oversold, so at this point in time it makes sense that we wait for more “value” in the US dollar as this market is certainly out of sorts. Short-term buying opportunities may present themselves for the next week or 2, but we do not anticipate a trend change quite yet.

 

Brent

Brent markets fell as well, testing the $42 level for support early in the week. With this being the case, the market found quite a bit of support and bullish pressure to push this market above the $50 handle. Because of this, the market looks as if it is going to reach towards the $52 handle which has been resistance previously. This is a market that is oversold as well, so at this point in time a bounce is desperately needed as far as we can tell.

The shape of the candle is massively bullish obviously, as it not only looks like a hammer, but one that extended above the top of what would be considered a hammer. In other words, it’s probably even more bullish. Resistive candles above should be selling opportunities, but at this point in time we do think that this bounce will continue for a couple of candles. Ultimately though, we feel that the sellers will come back in and pushes market lower from higher regions than where we set at the moment. Ultimately, even if we are trying to change the trend most the time that takes quite a bit of volatility.