Crude Oil Price Outlook – Crude Rallies to Kick Off the Week

WTI/CL Technical Analysis

The light sweet crude oil market appears to be trying to break out during the trading session here on Monday, as we are trying everything we can to clear the $65 level. The $65 level is a large, round, psychologically significant figure and an area that previously had been support. So, market memory dictated that it was resistance recently. We are now finally starting to see the market try to overcome. And I do think that eventually we will break higher. I’ve been talking about a bottoming pattern for what seems like a lifetime now, and we are starting to finally kick it off, I believe.

This is despite the fact that OPEC continues to talk about producing more crude oil. So, I find that very interesting. That definitely captures my attention. When you look at the last four or five years, the area above $65 opens up the possibility of a move to the $72.50 level, but that’s obviously a long-term move. Short-term dips continue to be bought into.

Brent Technical Analysis

Brent markets look very much the same, although they have not overcome the barrier in the form of $68, but one would think that if WTI does, then Brent will just simply follow suit. The 200-day EMA is closer to the $72 level, so that could be your target. And I do think there’s plenty of support underneath here as well, so I like the idea of buying short-term dips.

I believe at this point in time, oil has fallen so far that there really aren’t that many people left to sell it, at least not for a sustained move. So, I’m looking for a breakout and one or the other, and right now it looks like WTI is going to be the first one, and then Brent probably follows.

For a look at all of today’s economic events, check out our economic calendar.