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Crude Oil Price Forecast – Crude Oil Markets Approach Major Gap

The crude oil markets have been rallying over the last couple of weeks as you know, but now face a monumental test as we are getting close to a major gap.
Christopher Lewis
Crude Oil WTI Brent

WTI Crude Oil

The West Texas Intermediate Crude market initially fell during the trading session on Tuesday but then turned around to rally. The market is currently hovering around the $32 level, but there is a major resistance barrier extending all the way to the $41 level. Because of this, one would have to think that sooner or later we will see exhaustion that sellers will jump all over. Quite frankly, it is difficult to imagine that crude oil demand is certainly going to surge as dramatically is a lot of the buyers seem to think. Because of this, I would be looking for exhaustion to take advantage of more than anything else at this point.

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Crude Oil Video 20.05.20

Brent

Brent markets have also rallied again, reaching towards the $35 level. This is an area that should of course attract a certain amount of attention but the gap above that is sitting at the $40 level would be an area that one would have to pay attention to. Signs of exhaustion will be jumped on over here as well, so at this point I think the market showing signs of weakness should send up red flags for traders around the world. I have a hard time believing that we will simply bust through the gap and continue going higher, although I am the first person to admit that we had far overachieved any expectations that I had previously. Nonetheless, sooner or later the reality comes back into play about the economy is going to continue to be a struggle at best.

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