The WTI Crude Oil markets have slightly positive session at the end of the day on Friday, after initially gapping lower. The gap wasn’t much though. Rather, I look at the totality of the move recently action and feel that the $102 level is indeed trying to act as a bit of a base in order for this market to go higher. I recognize that there is resistance of the $104 level, so even if we do go higher from here, it’s probably going to be choppy until we clear that level on a daily close.
All things being equal though, I am bullish of this market, mainly because of the Tuesday am are that was formed after bouncing off the $101 level. Below there, I see a significant amount of support all the way down to $100, so I believe that you simply cannot sell this market right now, even though the volatility has been extraordinary around the financial markets, this particular market has marched straight up.
The market is formed a “W pattern”, which of course is very bullish sign. If we break out above the $104 level, I feel that there can be no doubt that the W pattern has been broken to the upside. Quite frankly, there’s a lot of different ways you could draw it based upon trend lines and such, but at the end of the day this would be the last little remnants of resistance from what I can tell. Either way, it really doesn’t matter because beyond that we have an obvious “floor” in this market right around the $100 level, so it’s almost impossible to start selling anyway. Quite frankly, even with a negative move, I would have to question whether or not we had enough room to really make it worth your while.
Pullbacks that show supportive candles will continue to be a vehicle for going long as well, but I do believe that a break above the $104 level is probably the safest bet, if there is such a thing in trading. At that point in time, I would fully expect this market to head towards the $110 level.