Crude Oil Price Analysis – Crude Jumps at Open

Light Sweet Crude Oil Technical Analysis

The light sweet crude oil market jumped higher right at the open on Monday to break above the recent resistance, but it has since pulled back. That being said, after that, we have seen the market bounce from the $100 level. The $100 level is a large, round, psychologically significant figure and an area that a lot of people have been watching.

If we were to break down below that level, then we could open up a move down to the $96 level. To the upside, we have the $105 level, possibly even the $110 level, as a target. Keep in mind, this is moving on the latest headlines coming out of the Middle East, more than anything else, and with that being the case, I think you have to be very careful about trying to get too big in a position. I do think this market favors the upside, but I also recognize we’ve seen wicked drops at the same time.

Brent Technical Analysis

The Brent market seems like it’s in the middle of a larger range between $100 on the bottom and the $120 level at the top. Ultimately, this is a market that I think remains more buy on the dip, and of course, Brent is going to be more sensitive to what’s going on in the Middle East, as the Strait of Hormuz will greatly influence Europe and Asia.

With this being the case, I think you have a situation where you don’t want to short this market at all, but you don’t necessarily just jump in with a huge position. The $100 level will continue to be very important not only to traders in the futures market but also in the  options markets.