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Crude Oil Price Forecast – crude markets stabilize on Friday

By:
Christopher Lewis
Updated: Jul 14, 2018, 04:45 UTC

Crude oil markets were stable on Friday, a welcome reprieve from the massive selling that we had seen. Ultimately, the market looks as if there is a lot of bearish pressure above though, so I think that at this point buyers are going to be a bit cautious about putting too much money to work.

Crude Oil daily chart, July 16, 2018

WTI Crude Oil

The WTI Crude Oil market initially when sideways during the trading session on Friday but then turned around to show signs of life again. The $70 level of course is very important from a psychological standpoint, but quite frankly the structural standpoint isn’t overly compelling at this point. I think that rallies would make sense as we have sold off so drastically, but I think it’s only a matter of time before the sellers get involved and start shorting. Quite frankly, I believe between the $73 level and the $75 level we will see a lot of supply.

Brent

Brent markets bounced rather nicely after falling during the trading session on Friday, testing the uptrend line that has been so crucial for quite some time. I think that this bounce is a good sign, but it’s not until we break above the $75 level that I would put the money to work. At that point, I suspect that the $77 level will cause a bit of resistance as well, as I see so much in the way of supply. I think short-term buying is possible, but we are going to make a serious go at this uptrend line, and if we can break down to a fresh, new low, extensively below the $73 level, then I think the market probably unwinds down to the $70 handle after that. Expect volatility, but it certainly looks as if there are a couple of clear levels to pay attention to.

Crude Oil Inventories Video 16.07.18

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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