WTI/CL Technical Analysis
The light sweet crude oil market has gapped a little bit higher to kick off the Tuesday session. But at this point in time, it looks like it’s stalling a bit. This is a market that is just what I believe consolidating in its summer range. While there is a huge supply of crude oil out there, the latest threats of sanctions against Russia, of course, have people worried about supply perhaps shrinking a bit. That being said, I don’t know if there’s enough to really break this market out.
And in fact, the last time it broke out, it took a war. So now we have the $65 level on the bottom offering support. And I believe the $70 level above will be probably about as high as this market can get in this environment. So, I think we’re just range bound. I think we’re going to be chopping back and forth. I do favor the upside, but right now I don’t see any major moves.
Brent Technical Analysis
The Brent markets look very much the same, very quiet, just kind of hanging out, looking for some type of momentum. I think it is worth noting that we have the 200 day EMA at the top of the consolidation area near $72 coming into the picture. So, I think that will offer a bit of a ceiling. If we do break out above there, then obviously that’s very bullish and it’ll probably drag both grades of oil up with it. To the downside, the $68 level continues to be support, and I still think this is a buy on the dip type of market in both grades of crude. I just don’t know that we have the momentum to make a significant breakout.
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