WTI Crude Oil
The WTI Crude Oil market initially tried to rally during the session on Thursday, but turned around to show weakness yet again. I am very bearish on this market, and I believe that oil has much farther to fall. The $47 level will offer a bit of support as we have seen a nice bounce from there. If we can break down below that level, I don’t see any reason why we don’t test the $45 level, my midterm target. I have no interest in buying, I believe it’s only a matter of time before we find sellers, and I see the absolute “ceiling” of this market being at the $52 handle now. Oversupply has finally caught up with the markets, and now it looks like the sellers are becoming even more aggressive.
Natural Gas
Natural gas market fell during the day on Thursday as we continue to teeter around the 2.80 handle. I think that it’s only a matter of time before we fall, and every time we rally I see a selling opportunity. I recognized the 3.00 level should be massively resistive and essentially the “ceiling” in this market. Energy markets are absolutely flooded with oversupply, be it natural gas or crude oil. On top of that, I don’t know that the demand is out there and it certainly isn’t going to have any boost from weather in the United States as we are starting to head the warmer temperatures. Short-term fluctuations to the upside are probably going to offer nice selling opportunities, as this market is in a long-term cyclical bear market. I believe that we will target the 2.60 level, and then the 2.50 level after that. Ultimately, I think we break down to fresh new lows soon and could even target the 2.00 level longer-term.
