Crude Oil Price Outlook – Crude Oil Recovers After Dropping

WTI/CL Technical Analysis

The light sweet crude oil market has gapped to the downside during the early hours on Thursday, only to turn around and show signs of life. And in fact, we have filled that gap and now it looks like we are going to challenge the 50 day EMA. If we can break above the 50 day EMA, then it opens up the possibility of a move to the $65 level. Breaking above the $65 level could open up the possibility of a move to the 200 day EMA.

Underneath, we have plenty of support near the $62 level that extends down to the $60 level, which I think is your floor in the market. Whether or not we can break out to the upside remains to be seen, but right now, I think you have to think of this more or less as a consolidation.

Brent Technical Analysis

The Brent market looks very much the same as we have broken below the 50-day EMA only to turn around and show signs of life. The $69 level is an area that, of course, has been resistant as of late. And if we were to break above there, it could open up a move to the 200 day EMA at the $70,14 cents level. Short-term pullbacks will have to deal with plenty of support, especially near the $65 level.

Keep in mind that crude oil has a major problem right now because the supply of oil is extreme around the world. And of course, there are concerns about the global economy perhaps slowing down. So, we’ll just have to see how that plays out.

The Federal Reserve cutting interest rates does help the idea of increased industrial demand down the road. So perhaps that’s part of why we recovered in both grades of crude oil. But really, at this point in time, not much has changed. We’re still very much in the same range.

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