WTI Crude Oil
The WTI Crude Oil market fell during the course of the session on Tuesday, testing the $38 level. This is a level that is supportive, so if we break down below there I feel that the market will then reach towards the $36 level, possibly even the $34 level. A bounce from here could send this market as high as the $42 level, and the fact that we have the Crude Oil Inventory numbers coming out during the session today, we could get quite a bit of volatility in this market. I personally believe that we go lower over the longer term, but at this moment there seems to be a lot of strength to the upside as well. I don’t think any move is going to be easy, but I still believe that sooner or later we fall.
Natural Gas
The natural gas markets rose drastically during the course of the day on Tuesday, gaining 7%. That is a massive move, but we are still below the $2 level and I feel that the $2 level could be a bit of a barrier to overcome. If we get some type of exhaustive candle in this general vicinity, it could be an opportunity to start selling again. With this, the market could very well fall back to the $1.80 level if we get that resistive or negative move. I believe that we could break down below there as well, and as a result I am still very negative. However, the area above the $2 level is going to be very difficult for me to start feeling comfortable going long, as we had such a massive downtrend at this point in time.
Having said that, I do recognize that the very bullish session on Tuesday is of course very impressive, so we may have a little way to go before been able to sell yet again. Supply still far outweighs demand.
