WTI/CL Technical Analysis
The light sweet crude oil market has dropped a bit in the early hours of Friday as we continue to test the crucial 200 day EMA. It’s also worth noting that the market has recently broken out of a short summer range but now seems like it’s trying to crawl back into it. Most of that bullish momentum was based on Donald Trump threatening Russia and countries buying Russian oil, thereby suggesting that perhaps there would be less supply.
I don’t know how long that lasts. I do recognize though, that the market is typically a bit more bullish this time of year anyway. So, I don’t think it’s really much to do, you know, at this point, other than to continue to buy dips. That’s kind of how I approached this for a while. The $65 level continues to be a massive floor in the market. But we’ll just have to wait and see. Ultimately, this is a market that if we break to the upside, I think we could go as high as the spike high at $78. But that probably takes quite some time.
Brent Technical Analysis
The Brent market is also pulling back, sitting on the 200-day EMA. And as a result, it’s worth looking at this through the prism of a market that I think remains buy on the dip, with the $68 level underneath as a floor in the market. All things being equal, this is a market where I’m a buyer of dips as well. But I also recognize that it’s very choppy.
I suspect it is a market that you will have to be very cautious with, but I think that given enough time, we probably have a pretty significant run waiting to happen. It’s probably going to be very slow in its overall uptrend. If we were to somehow break down below the support in either one of these grades, that would be extraordinarily negative. But that’s not necessarily what I’m looking for.
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