Crude Oil Price Forecast – Crude Oil Markets Rocked By Saudi Price War

WTI Crude Oil

The WTI Crude Oil market gapped lower to break down below the $35 level, reach towards the $27.35 level before bouncing yet again to form a somewhat supportive looking candle. However, that massive gap above will offer resistance so while we could get a short-term bounce towards the $40 level, I do believe that there would be sellers near that level yet again. Any time there is a massive selloff like we have seen, there is almost always a dead cat bounce next. That seems to be what we are setting up to do. If we were to recapture the $41.00 level, then it’s possible that the market could go looking towards the $45 level after that. That being said though, it seems to be very unlikely to happen.

Crude Oil Video 10.03.20

Brent

Brent markets also gapped lower, reaching below the $40.00 level and then falling all the way down towards the $31 handle after that. The market has turned around to form a bit of a hammer, which of course is a very bullish sign but it’s very difficult to imagine a scenario where you should be a buyer because the Saudi’s price war will certainly cause havoc in the market. At this point, any bounce will probably be more or less along the lines of a “dead cat bounce”, which means that we will roll over again. At this point, I like the idea of fading short-term rallies that show signs of exhaustion. Where the bottom is, we don’t know quite yet.