Crude Oil Price Outlook – Crude Oil Continues to Attempt a Recovery

WTI/CL Technical Analysis

The light sweet crude oil market has initially dropped after gapping higher on Monday but then turned around to show signs of strength again. At this point it looks like we are trying to get to the $65 level, an area that previously had been significant resistance as well as support. Light sweet crude suffers the same fate as most oil at the moment because, quite frankly, everybody is pumping out as much crude oil as they can, and I think that gives us a situation where it’s really difficult for oil to have a sustained rally. I’m watching the $65 level very closely to see if there are any signs of exhaustion that I can start shorting. The 50-day EMA sits right there as well, so that adds even more intrigue to the market in that region.

Brent Technical Analysis

The Brent market is breaking above the 50-day EMA and, quite frankly, looks a little stronger, but even if we do rally from here, the market is likely to see the $70 level offer resistance as well. The $65 area below is a support level as well, so that, of course, offers a pretty significant target for those who are shorting this market.

Nonetheless, we don’t see any action that suggests that we are rolling over quite yet, but I do expect to see that sooner rather than later. This time of year does lack a bit of volume as well, so that could come into play also.

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