WTI/CL Technical Analysis
The light sweet crude oil market has drifted a little bit lower during the early hours here on Friday as we continue to see a lot of noisy behavior, but I think more importantly, quite a bit of negative behavior. The oversupply of crude oil continues to be a major issue, with a lot of oil flowing out of the United States, Russia and the OPEC at the moment. And in fact, they are increasing production. So, this of course has a lot of negative pressure on pricing for uh crude oil.
At this point in time, there is a situation where the market is probably trying to find its next range. I do think that the $62 region will at least attract some value hunters. And I also believe that the $65 level above continues to be resistance.
Brent Technical Analysis
The Brent market has broken below the $67 level, looking very likely to go down to $65 eventually. The $65 level, of course, is an area that’s been support more than once, so I would anticipate a little bit of market memory in that region. If we turn around and rally from here, the 50-day EMA currently sits at the $67.93 level and is dropping.
Anything above there opens up the possibility of a move to the $69 level, which is the top of the range. Ultimately, I do think Brent is going to behave very much like the light, sweet crude oil market, just simply due to the fact that we have a lot of concerns out there about economic growth. And at the same time, supply seems to be only increasing. That’s a recipe for low pricing.
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