Crude Oil Price Analysis – Crude Oil Continues to Move on Headlines, or Lack of

Crude Oil Technical Analysis

The light sweet crude oil market has rallied quite nicely during the early part of the Thursday session but has given back gains rather rapidly. By doing so, it ends up forming a less than exciting-looking candlestick and I think it just shows how noisy we are at the moment. Traders really have no idea what to do with themselves, nor what to do with the market right now. I think that will be the way going forward as it is almost impossible to truly determine what’s going on in the Middle East.

Longer term, I think there is going to be less supply of crude oil coming out of the Middle East, so I think the floor is higher than it once was. It looks like we’re getting ready to roll over, but I would anticipate support near the 50-day EMA.

Brent Technical Analysis

The Brent market initially broke out towards the $105 level and even broke above there, but since then we have dropped. The $100 level underneath is support, and if we could break down below there, then the $95 level gets targeted. I think ultimately this is a situation where you have to be somewhat careful, but I also recognize that the choppy volatility will continue to be a major issue.

Given enough time, I fully anticipate that this is a market that will try to find its range, but as we’re moving on the latest headlines at the moment, it’s difficult. I do think we end up lower before it’s all said and done, but that could be 3 weeks from now. This is a very difficult market to trade and quite frankly, I recommend not bothering, but if you do, you have to recognize that just below the $100 level there is a certain amount of demand.