Crude Oil Price Outlook – Crude Oil Continue to Look Weak

WTI/CL Technical Analysis

The light sweet crude oil market has shown itself to be somewhat buoyant during the early hours on Wednesday. But really at this point in time, if you see a bit of a bounce, I think you have a situation where sooner or later sellers jump back in. This is a market that has been extraordinarily weak. And it’s worth noting that previously the area between $60 and $62 had been support. So, I would anticipate that it ends up being resistance.

I do not like the idea of buying oil at the moment. It just has proven itself to be far too weak. And we, of course, have oversupply coming out of OPEC, Russia, and the United States at the moment. Although it’s worth noting that OPEC added less than anticipated recently, it’s still too much for what the market can handle. It’s not until we break above the 50-day EMA that I begin to think about being bullish, and we’re nowhere near that right now.

Brent Technical Analysis

Brent markets look very much the same, with the $64 level being the beginning of a zone of support that runs to the $65 level. Ultimately, it does look like we are a little oversold, so I think a little bit of a relief rally makes sense here as well, and if we can get anywhere near $65 with an exhaustion candle with a long wick at the top of it, I’m more than willing to jump in and start selling.

I just don’t have any interest in buying crude oil at the moment. And I think you’ve got a situation where if you’re patient, you might get a nice opportunity to short again. Range-bound traders may muck about in this area, but for me, it’s shifted from a sideways range-bound market to one that will have the occasional bounce that will almost certainly get squashed.

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