Crude Oil forecast for the week of January 23, 2017, Technical Analysis

WTI Crude Oil

The WTI Crude Oil market fell initially during the week but found enough support just above the $50 level to form a hammer. The hammer of course is a bullish sign, but we also should worry about the $55 level above. That’s an area that should cause quite a bit of resistance, but once we get above there we will more than likely try to reach towards the $60 handle. This being the case, I think a lot of buyers are very interested in this market, but I also recognize that a breakdown below the $50 level census market much lower. The inventory numbers continue to get bearish, so having said that it’s likely that the market will continue to see quite a bit of volatility and eventually bearish pressure. I believe that the $60 level is essentially the top of the market longer term.

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Brent

Brent markets went back and forth during the week as we continue to see a lot of interest in this market at the $55 handle. The neutral candle suggests that the market is still trying to figure out what to do, and the inventories seem to be rising in the United States. Longer-term I think this will be bearish, especially considering that the US dollar is going higher and value. And exhaustive candle somewhere in this area should give you an opportunity to start selling again. I don’t think that the $60 level gets broken anytime soon, but if we do get above their then we will more than likely reach toward $65.

 

This is a market that has been very bullish for some time, especially after the OPEC production cuts were announced. Having said that, it’s likely that the markets will continue to be difficult to deal with, and longer-term traders may be of it stymied by all the volatility. Because of this, I think that a little bit more clarity might be needed to place a longer-term position. Until then, it is more than likely going to be a market that needs to be traded off short-term charts.