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Crude Oil Forecast October 6, 2014, Technical Analysis

By:
Christopher Lewis
Updated: Aug 24, 2015, 22:00 UTC

Light Sweet Crude The light sweet crude market fell during the majority of the session on Friday, testing the $90.00 level for support. The market formed

Crude Oil Forecast October 6, 2014, Technical Analysis

Light Sweet Crude

The light sweet crude market fell during the majority of the session on Friday, testing the $90.00 level for support. The market formed a hammer on Thursday, and as a result it looks like there is a bit of support below, but at this point in time would necessarily be willing to buy this market. Because of that, we believe that a break below the bottom of the hammer is reason enough to start selling, or perhaps a bounce closer to the $94.00 level would give us a reason to start selling on signs of resistance. That being the case, the market will more than likely continue to drift lower over the longer term, but right now it appears that we could get a little bit of a boost due to the oversold conditions of we currently see.

Crude Oil Forecast October 6, 2014, Technical Analysis
Crude Oil Forecast October 6, 2014, Technical Analysis

Brent

The Brent market fell during the course of the day on Friday, busting through the bottom of the hammer at one point during the session. A breakdown below the bottom of both the Thursday and Friday session signifies that this market is in fact going to head to the $90 level. Any bounce from here should be a nice selling opportunity, as the $97 level above would in fact be massively resistive.                      

We would love to sell at a higher level on a resistant candle, as it would represent value in the US dollar, currently the most important financial instrument out there. We believe that this market should continue to drop to at least the $90 level, and perhaps as low as $85.

Looking at the shape of this chart, we believe that any rally will fail, especially considering that there is such a massive “ledge” that had formed at the $97 level, and that should represent quite a bit of selling pressure. If we did somehow break above there, we would probably try to get to the $100 level, and above there of course we believe that the trend will have changed at that point in time. That seems very unlikely though, so we believe that we will be selling soon.

 

brent

About the Author

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.

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