Crude Oil Price- Feb. 18, 2014

Christopher Lewis

The WTI Crude Oil markets found strength during the session on Monday, but it should be noted that the session would have been weighted towards the Asian and European time frames, as the Americans celebrated President’s Day, therefore limiting the liquidity during part of the session. With this, I am not so concerned about the fact that we lost some strength later in the day, but cannot help but recognize that the area above has been resistive previously.

In fact, we are in consolidation. Because of this, I am not overly interested in longer-term positions at the moment, but do recognize that there comes a point (in my opinion $101.50) where buying is important. In the meantime, I would suspect that the day traders will run the show as this market goes back and forth.

Tied to the Dollar, but also growth.

The oil markets are naturally tied to the value of the US Dollar, as the market is priced in the USD. However, the use or demand in the market can also be concurrent with the uptrend in US Dollars, especially when it appears that the economy is picking up. After all, the economy picking up means more transportation needs as far as oil is concerned, and factories will be using more of it as well. With that, the oil markets should be sensitive to economic numbers out of the US, as it appears to be recovering, albeit slowly.

The $99.50 level below should continue to be supportive, so I will be buying this market on pullbacks, but only with small positions, and just for short-term moves. I think that the sideways market will continue, as there are a lot of moving parts to the global economy at the moment. With this, I think the choppiness should continue, but eventually we will break out, and this is when I am willing to risk more. I will be using options more than anything else, as it defines my risk upfront, and I can simply step away from the market without driving myself crazy!

Crude Oil 21814

Christopher Lewis

Christopher Lewis has been trading Forex for several years. He writes about Forex for many online publications, including his own site, aptly named The Trader Guy.

Did you like what you read? Let us know what you think!

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

0 User comments

exclamation mark

Please make sure your comments are appropriate and that they do not promote services or products, political parties, campaign material or ballot propositions. Comments that contain abusive, vulgar, offensive, threatening or harassing language, or personal attacks of any kind will be deleted. Comments including inappropriate will also be removed.

Read more
Add new comment
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.