WTI and Brent Crude Forecasts – Holiday Thin Liquidity Limits Outright Breakouts

WTI Crude Oil Technical Analysis

The Light Sweet Crude Oil market has shown itself to be a little bit choppy at the moment and I am not overly surprised at this point due to the fact that the $70 level is sitting just above, and of course, you have to keep in mind that the overall liquidity would be thin to say the least, as the Americans are away for the Independence Day holiday. Therefore, most of what you’re seeing here is probably position squaring overnight, and I wouldn’t read too much into it. I do think, now that we have filled the gap, though, it is probably only a matter of time before the buyers probably try to push this market to the upside to find the top of the summer range. This would be the typical behavior for this time of year.

Brent Crude Oil Technical Analysis

Brent markets look very much the same. It looks to me like they’ve got a pretty significant floor in the form of $70. Market probably try to look for the upside from here on Monday with limited success, and as I said, we’re just oversold. I think we’re trying to find the top of a range here. Once we do, we’ll drift lower in this market, but I am cautious about position sizing at this point.

But, if we break down below the $70 level, then that just signifies that we have even further downward pressure to deal with, perhaps sending the market down to $67. The world is pricing in peace in the oil markets, but of course, there is more to it than that, and I think we’re overdone in the downward direction, just like we had been overdone in the upward direction previously.

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