Crude Oil Price Forecast – crude oil markets show strength earlyCrude oil markets rallied significantly during the early hours on Tuesday, breaking above the short term consolidation. However, as the Americans came on board we have gotten word that there is increased tariffs coming from the Chinese, so this has had a bit of a negative effect.
WTI Crude Oil
The WTI Crude Oil market broke above the $69.50 level early during the day on Tuesday, and then reach this high as $70 before pulling back. This area of resistance makes sense, it’s a large, round, psychologically significant figure, and of course there are a lot of concerns about the possible lack of demand due to increased tariffs. I think this type of volatility continues to be a mainstay in this market, but the one good thing that I see here is that we have made a “higher high” now. However, it would not surprise me at all to see this market break back down to $69 to go looking for support.
The Brent market broke above the $79 level during trading and early hours, perhaps urged on by what was initially the very calm reaction of the Chinese to fresh US tariffs. However, they have continued forward with a complaint to the WTO and for tariffs, so this has people worried about overall demand. When you look at the chart though, you can see that as I record this we are testing the top of the consolidation area, so it’ll be interesting to see if it can offer support. I think we continue to see erratic moves, and quite frankly this may continue to be a “by on the dips” scenario, but it is certainly going to be difficult regardless. I expect see a lot of support at the $70 level.