Crude Oil Price Analysis – Oil Bounces on Tensions

Crude Oil Technical Analysis

The light sweet crude oil market has rallied pretty quickly during the early hours on Wednesday as we continue to see tensions between Russia and Ukraine. Quite frankly, I think that was just your excuse as traders are trying to do everything they can to send oil higher.

This latest round of noise is probably more to do with the fact that we are range-bound. We got to the bottom of the range, somebody found a reason to start buying, and here we are. It does look like the 200-day EMA is going to continue to be important in this market. I don’t really see how it isn’t, but I also recognize that if we can break above the $65 level, then it’s likely that we will see a significant change in attitude. At that point, I think you’re probably looking at the market really starting to take off.

In general, I think we’re trying to find the summer range and it’s somewhere around here. Maybe it’s a little higher. I don’t have any interest in shorting.

Brent Technical Analysis

Brent looks the same with the $70 level above offering a bit of resistance. If we can break above the $70 level, then it’s possible that the market could go looking to the $72 level. Short-term pullbacks open up the possibility of finding buying pressure underneath, especially near the 200-day EMA.

I’ve got no interest in shorting this market either. I think this time of year typically is a little bit more bullish and I think the fact that driving season is about to hit, that brings a little bit more demand into the market. I don’t think we’re going to shoot straight up in the air. I think this is a situation where we’re just going to grind higher overall.

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