The WTI Crude Oil markets initially gapped higher at the open on Friday, but as you can see spent the rest of the day falling. We did find a little bit of support at roughly $106.50, and as a result we ended up forming a hammer at the end of the session. The hammer suggests that we are going to go higher, but ultimately we also have to look at the fact that this market will continue to be very volatile. The $105 level been broken to the upside was in fact significant, not only because it was resistance but because it was the top of an ascending triangle.
With that being the case, we feel that this market will more than likely continue to grind higher, hitting the target based upon measurement of said triangle. That means that the market should go to the $113 level, but obviously won’t happen overnight. With that, I believe that pulling back every once in a while will give you buying opportunities as this market continues to go back and forth based upon sentiment.
This market is “buy only” as far as I can see.
Because we broke out above the top of the triangle, I have absolutely no interest in selling this market anytime soon. In fact, I believe that this market will continue to find buyers every time it falls, simply because it is such an obvious bullish market, and the fact that we did break out of such obvious resistance.
Ultimately, I don’t see any reason why we won’t hit the 113 level, but I think that it’s going to take some time as there are a lot of nervous traders out there, and a line of swirling headwinds in the marketplace as demand will be scrutinized, so will the value of the US dollar. On top of that, the market should continue to offer plenty of opportunities though due to the concerns. Short-term traders will continue to buy this market time and time again, and as a result if you have the ability short-term trading might be the way to go.
