Crude Oil Price Outlook – Crude Oil Continues to See Supportive Action

WTI Crude Oil Technical Analysis

The West Texas Intermediate crude oil market bounced a little bit during the trading session on Tuesday in the early hours as we continue to see more of a buy on the dip behavior in this market, despite the fact that I think more or less it’s sideways. The $65 level underneath is a massive support level that I think a lot of people will be paying attention to.

If the market were to break higher, the 50 day EMA comes into the picture as a potential resistance and the $72 50 cents level most certainly will as it is the top of this range. As things stand right now, I just look at this as a sideways market. As we head into the early part of next year. I think it could turn around and go higher.

Brent Crude Oil Technical Analysis

Brent is very much in the same situation. Although probably a little less bullish than the West Texas Intermediate, which makes sense considering it’s the US economy that just simply won’t slow down, but it will have a bit of a mimicking attitude if you will. The $70 level underneath is massive support. The 50 day EMA is offering resistance, but if we can break above there, then we could look at the Brent market going to the $76 level and then eventually the 200 day EMA.

With both grades of oil, if we break down below the support, it probably leads to about a $5 drop. In general, though, it does look like it is being a support level that is going to be difficult to break through. And therefore, I think we are probably more likely than not going to see something perhaps strengthening U.S. economy come in and lift oil rather than break down. But it is a very real possibility, so you do have to keep the alternate scenario in the back of your mind also.

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