Crude Oil Goes Parabolic

West Texas Intermediate

The West Texas Intermediate Crude Oil markets have exploded to the upside, ripping through the $100 level rather rapidly. With the concerns about Russian crude oil, it does make a certain amount of sense that we would see crude oil rally as shipping has all but abandoned Russia. If that oil does in fact come off of the market, then it makes a certain amount of sense that we would see higher prices.

Furthermore, we have the problem with the reopening trade not being fully covered, as production of crude oil was slowed down during the pandemic. Everything put together, it is obvious that this is a market that is probably going to go higher. Look for short-term pullbacks to take advantage of value.

WTI Oil Video 07.03.22

Brent

Brent of course did the exact same thing during the course of the week, reaching towards the $120 level. The size of the candlestick is rather impressive, and this does of course suggest that we will probably have more upward pressure to go. The $100 level underneath should continue to offer support, and I do think that it is probably only a matter of time before we see buyers come in on any type of pullback. After all, this is a market that is clearly bullish, and therefore you would not expect to see much in the way of a selling opportunity.

This brings up an important point that I would bring to you. I have seen a couple of professional traders suggest that “this may be a great setup to fade.” While that can happen and can even be profitable, all one has to do is take a look at the last year in this market to realize which direction would have been much easier.

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