The WTI Crude Oil markets fell during the session on Tuesday, plunging towards the $94.00. This area has been supportive lately, as well as resistive. Because of this, I suspect that this market will take a little bit of a breather in this general vicinity, and the fact that on the hourly chart we see two hammers at the end of the session tends to lead me to believe this even more.
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However, I believe that we are closer to the top than the bottom as I have been saying for a few sessions now, and as a result any support that we see in this general vicinity should offer selling opportunities after a bounce. I believe that the $97.00 level is far too resistive for the buyers to breakout above, and as a result we should see this market remained fairly range bound over the course of the next several weeks, if not months.
Nonetheless, I think that there will be plenty of volatility, it would just be on the shorter timeframe charts. After all, looking at this chart it appears that the $90.00 level is a much more supportive area. In fact, I believe that if we do start to break down again, that is exactly what we will target first. Granted, it will be much of a smooth ride as there are plenty of minor areas between here and there, but at the end of the day it will eventually reach that area.
Choppiness and scalping
I think that if we can break down from here, we will see quite a bit of choppiness and plenty of scalping opportunities. Going forward, I think that scalping to the downside will pay dividends for the next several sessions. If this market does rally, I am simply going to wait and short the first resistive candle that I see. Beyond that, there is a whole lot to do in this market as a longer-term trade is almost impossible at this point. Adding to that is the fact that we are heading towards the summer months, which of course normally means a well-defined range.