During the Friday session, the WTI Crude Oil markets fell rather hard. The candle of course closed just above the $100.50 level, but more importantly close towards the very bottom of the range. This almost always means continuation of the move, so therefore I would expect this market to sell off a bit more today. However, we aren’t that far from the large, round, psychologically significant barrier of $100, so I would be a bit hesitant to sell in this general vicinity because of that. On top of that, I can see several little micro support areas that could cause the market to bounce between here and the $97 level.
In fact, it is not until we get below the $97 level that selling is even possible as far as I can tell. It’s not to say that a move below there would be easy either, it’s just that it would clear a lot of support. With that, I am essentially looking for buying opportunities only in this market.
There is the potential of a double top.
Unfortunately, there is the potential that we’ve seen a double top at the $105 level. Because of that, you do have to be on your toes but I think ultimately this market will go higher. Really will we need to see this point in time is some type a supportive candle in order to start going long, and that point in time I would not hesitate to do so as the move higher has been so strong. The real question then becomes whether or not we are consolidating between $100 and $105, or if we’re still we trying to build up enough momentum to breakout to the upside.
If we do breakout above the $105 level, I believe that the market then heads to the $110 level without too many issues. On the longer-term charts, it is a major area, and over time the markets do tend to be attracted to these levels. Again, at this point time I have absolutely no interest in selling this market until we get below the $97 handle.