Crude Oil Price Forecast – crude shows its strength on Tuesday

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Updated: Aug 22, 2018, 05:37 UTC

It wasn’t that long ago that we were hearing about the demise of crude oil, and how it was going to fall apart. However, most of the hedge fund traders that I speak to believe in the long term bullishness of this market. We had recently bounced from a couple of trendlines, and Tuesday showed it just how much underlying strength there is in this market.

WTI Crude Oil

While I don’t think that we are out of the woods quite yet, the massive swell of volume in the WTI market on Tuesday, along with busting through major resistance at the $66 level, tells me that there is underlying demand. As I record this, I would point out that we did struggle at the $66.50 level, the next barrier, but at the end of the day we had just sliced through one in the same candle. That might be a bit much to expect in one fell swoop. I do think at this point we are looking at a “buy on the dips” scenario. With this in mind, I suspect that this market will probably go looking towards $67.50 on the break out. If we do break down below the $65 level, that could change things, but right now it looks like there is plenty of volume underneath.

Brent

Brent markets also rallied, but not as stringently. The $73 level has offered a bit of resistance, and therefore I think it will remain a laggard to the WTI grade, as far as momentum is concerned. The two markets had diverged enough to cause this move and the necessity of it, so I think eventually they both will go higher but if I had to pick one or the other, right now it looks like West Texas Intermediate is the way to go.

Oil Forecast Video 22.08.18

About the Author

Christopher Lewisauthor

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.