WTI Crude Oil markets rose during the session on Wednesday, breaking above the $95 level, and as a result the market looks like it's ready to do a little bit of a bounce from here. The bounce should have the fire step in and try to support the oil markets as they have been so beat up. However, I have to wonder whether or not this is a simple "dead cat bounce", or is it something a little bit more significant? The reality is that the market certainly have taken a bearish turn, and because of that I feel that this market is more than likely going to be one that you can sell every time it rallies in the near-term.
The $95 handle of course is a little bit of a significant barrier, at least for a psychological standpoint. Nonetheless, with the nonfarm payroll number coming out this Friday, you can expect the oil markets in general to be affected by that number, because so many people were out there wondering whether or not the US economy is picking up steam or if the Federal Reserve can taper off of quantitative easing, quite frankly a statement I am getting bored of typing. However, the markets seem to be focusing on this one question, and being very schizophrenic about the answer, so as long as that's the case, I cannot ignore that factor.
Friday should be important, but will we get any true answers?
The Friday numbers of course will be important because people will wonder whether or not the economy in the United States is picking up, or is installing? There are cases to be made for either direction, and because of that expect a rally trading. Nonetheless, I do think that the markets are going to struggle fall too much farther, simply because they have been sold off so drastically. Because of that, I feel that this probably a bit of trading to be had in either direction, and if your short-term trader you can probably take advantage of the bounce all the way up to the $98 level, but I would certainly get out of the way at that point. I would also suggest that the trader that's going to be interested in higher time frames sell resistive candles near that same $98 level.
