Crude Oil Price Forecast – Crude Oil Markets Continue to Show Underlying Strength

WTI Crude Oil

The West Texas Intermediate Crude Oil market rallied significantly during the trading session on Friday to reach towards the $30 level. At this point, there is a lot of resistance above in that region that will continue to keep this market under wraps. If we were to break above the $30 level, that could open up the move towards a gap, extending all the way to the $42 level. However, it comes down to supply and demand and with the US closing down half of its rigs that is a possibility but from a technical analysis standpoint, $30 is going to be exceedingly difficult to break above.

Crude Oil Video 18.05.20

Brent

Brent markets tried to rally during the trading session on Friday as well but have struggled at the 50 day EMA to turn around. I believe that this could be a sign that the markets are going to continue to struggle overall, and this could be a bit of a leading indicator for the WTI market if it breaks down. A breakdown below the $29 level could open up quite a bit of selling in this market. That being said, if we break above the $35 level, then it is very bullish and opens up the possibility of the gap being filled. Either way, I believe that the gap will be a major ceiling in both of these grades of crude oil, so I would be a seller up at that level as crude oil demand will not bring in $50 a barrel prices anytime soon.