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Christopher Lewis
WTI and Brent Crude Oil

WTI Crude Oil

The West Texas Intermediate Crude Oil market has been pummeled during the trading session on Thursday, breaking down below the $37 level. This is a very ugly candlestick and quite frankly was probably a bit overdue. We did not quite fill the gap, but we have gotten remarkably close. I suspect that there are still traders out there looking to do that, so I anticipate that there will be buyers eventually to the downside. The $35 level would be an obvious support area based upon the round figure, so do not be surprised at all to see this market reach there.

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Crude Oil Video 12.06.20

Brent

Brent markets of course did the same thing, as there seems to be a lot of concern when it comes to reinfection of the coronavirus around the world. All things been equal though, I think this is simply an overbought market, and that the pullback to the $35 level or even the 50 day EMA makes quite a bit of sense. We still have not filled the gap and gaps almost always gets filled so that is something worth paying attention to. I think at this point buyers are simply stepping back and waiting for a bit of value, so a bit of patience might be the best way to trade this market. I do not think we break above the $45 level though, so we are awfully long in the tooth when it comes to the rally and therefore, I think a lot of people were probably happy to get relatively close to that target.

For a look at all of today’s economic events, check out our economic calendar.

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