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Crude Oil Price Forecast – Crude Oil Testing Major Support

The crude oil markets initially tried to rally during the trading session on Tuesday, as word got out that the Saudi and Russian oil ministers were speaking on the phone about potential cuts. An emergency meeting is going to be held, and that in theory should help the markets. However, as Chinese demand is expected to drop by at least 20%, market forces may continue to press the issue.
Christopher Lewis
Crude Oil Price Forecast - Crude Oil Testing Major Support

WTI Crude Oil

The WTI Crude Oil market has spiked initially during trading on Tuesday, reaching as high as the $51.50 level. However, the market has sold off again, and it looks as if we are going to try to break down below the $50 level. A breakdown below that level seems to be somewhat imminent though, especially if the Brent market continues to fall the way it has. However, if the market was to break above the $52.50 level, then we can have a go at significant resistance. All things being equal though, it looks like short-term rallies in the crude oil market are still to be sold.

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Oil Forecast Video 05.02.20

Brent

Brent markets also have fallen, but unlike the WTI grade, they have actually broken significantly below support and now are testing the $55 level for potential resistance. It looks very likely that the market is ready to go towards the $50 level underneath, which obviously will attract a lot of attention. At this point, the crude oil markets have broken through significant support, so it’s very likely that they will continue to try to break down a bit. However, it should also be noted that the market could very well turn around based upon some type of political issue, as they are sensitive to all of that. Right now, though, it’s obvious that the market is focusing on China, and we are quite ready to see demand pick up there. Selling rallies should continue to work.

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