Crude Oil Weekly Price Forecast – Crude Oil Continue to Soften

WTI Crude Oil

The West Texas Intermediate Crude Oil market broke down towards the $37 level during the trading session on Friday, capping off a very negative week. That being said, if we break down below this week’s candlestick, it is likely that we go looking towards the $35 level, possibly even the $30 level after that. Rallies at this point should continue to be sold into, as the 50 week EMA above has offered significant amount of resistance. Fading those rallies on shorter-term charts probably being the best trade out there. However, if we break down below the lows, I think we will see an acceleration to the downside as there simply is not demand out there.

WTI Oil Video 05.10.20

Brent

Brent markets have broken down below the $40 level, which of course is a crucial level for traders to pay attention to as it is a large, round, psychologically significant figure, and an area where we have seen support in the past. The fact that we have made a “lower low” suggests to me that the market is ready to go lower, perhaps reaching down towards the $35 level, possibly down to the $30 level. Rallies at this point are to be sold into, and therefore it is likely that the rallies at this point continue to show signs of selling on short-term charts as you can take advantage of. At this point, I have no interest whatsoever in buying oil, as I do not see the scenario where it certainly takes off unless of course the US dollar collapses suddenly. That seems very unlikely.

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