Crude Oil Price Outlook – Crude Oil Continues to Look Soft

The light sweet crude oil market did drift a little bit lower during the early hours on Wednesday, as we continue to see a bit of negativity. Whether or not we break down remains to be seen, but really, at this point in time, one thing you need to keep in the back of your mind is that Thursday is Thanksgiving.

Fading Rallies in a WTI Oversupplied Market

That will obviously have a major influence on what happens next, as the Thanksgiving hours are shortened for the futures market, and obviously, that will have an influence on CFD markets if you’re involved there. Short-term rallies at this point in time should end up being selling opportunities, and I’m watching the 50-day EMA, which is just above the $60 level and a downtrend line. Any rally at this point in time shows signs of exhaustion, and at that point, I’m willing to start going short again.

The $55 level is a potential floor in the market, and I think it will take a lot of work to get below there.

Brent Oil Technical Analysis

Brent markets gap lower, and basically just sat there after the open, and now it looks like we are trying to determine whether or not we are going to start dropping toward the floor. The floor at this point in time is the $60 level, which has been a major support level going back to early April.

If we rally at this point in time, I’d be watching the 50-day EMA and the downtrend line that is here as well. And again, I think this is a situation where you are fading short-term rallies. Remember, OPEC, Russia, and the United States are all throwing a ton of oil into the market. So that has a major influence on the oversupply of crude oil and what could potentially be a somewhat slow economy right now in various parts of the world. That will put a drag on demand.

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