The WTI Crude Oil markets tried to rally during the session on Thursday, but as you can see ran into a bit of resistance at the $102 level. With that, the market pulled back enough to form a shooting star, which of course looks very bearish. However, the biggest problem with this market is that there are far too many areas where buyers can step in. With that, I am hesitant to start shorting this market, especially considering that the recent uptrend line would be approached somewhere in the neighborhood of around $100.
With that, I think that the WTI market may drift a little bit lower from here, but we did in fact form a hammer during the session on Wednesday, so even if we do fall from here, I don’t think it’s going to be very far. Most likely, we will see this market grind sideways in the near-term as we try to build some type of base in order to go higher.
Go with the trend.
By far, the best way to trade as to go with the overall trend. The overall trend in this market is most certainly to the upside, even though we have had a fairly significant pullback. On top of that, there is such thing as a double top of the moment, but I also believe that there so much support below that is going to be very difficult to sell this market. With that, I believe that a break above the top of the shooting star from the Thursday session would be enough to bring buyers back into the marketplace, and would certainly have me bullish. At that point in time, I think the market goes to the $105 level given enough time, and that the $105 level might be resistance that eventually gives way. If we get above there, I don’t see any reason why this market can’t go to the $110 level, and that is my target for this summer. Again, as far selling is concerned I’m not interested in doing so, but a move below the $100 level would certainly have me thinking that could be the way to go.