Crude Oil Price Forecast – Crude Oil Markets Break DownCrude oil markets broke down a bit on Thursday, as we have had a bit of a scare in the markets overall. Anything related to risk has been sold off.
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.
Crude Oil Video 12.06.20
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.