Crude Oil Forecast November 9, 2015, Technical Analysis

Light Sweet Crude

The light sweet crude market fell during the day on Friday in reaction to a stronger than anticipated jobs number. While you could make an argument for more demand based upon more hiring in the United States, the US dollar strengthened so much that it overrode that type of thinking. It looks now as if we are going to reach down towards the $42.50 level, and that could be where we find yourselves in the next session or so. If we can break down below there, we feel that this market is free and clear to head towards the $40.00 level. We would consider buying supportive candles, but we do not have one yet and recognize that this seems to be more focused on currency than demand at the moment, although it should be said that’s been a bit suppressed lately as well.

Brent

Brent markets actually tried to rally initially during the day but found more than enough resistance above the $40.50 level to turn things back around and form a bit of a shooting star. The shooting star of course shows more negativity in the marketplace, and as a result we will more than likely try to reach towards the $46.50 level. If we can break down below that level, we are free and clear to go down to the $44 handle. Quite frankly, we think that’s what going to happen but recognize that this will be a fairly choppy market.

If we did manage to break above the top of the shooting star for the session on Friday though, that probably sends this market looking for $51. We doubt that were to get above there anytime soon, but that of course would be extraordinarily bullish. At this point in time, Brent looks very soft and it looks as if the sellers are most certainly in control yet again. The strengthening US dollar of course will continue to work against the value of Brent, and as a result we prefer selling at this point in time as the market should continue to offer profit in that direction.