WTI Crude Oil
The WTI Crude Oil market fell slightly during the course of the session on Tuesday, but still looks as if we are trying to break above the $42 level. Ultimately, the market looks as if it will try to get above there but we have the Crude Oil Inventories number coming out today, and that of course can move the market. With this being the case, a move above the $42 level should send this market looking for the $44 level above.
On entering, if we break down below the bottom of the range of the day on Tuesday, we could drop down to roughly the $39 level. It comes down to whether or not the market can break out to the upside, but sooner or later we are going to have sellers of this market as the supply is far too expensive for the demand to take out.
Natural Gas
The natural gas markets rose during the day as we bounced off of the $1.80 level to show signs of life again. Ultimately though, this is a market that is so negative that it’s only a matter of time before we see sellers. The market should then fall on the way down to the $1.60 level below, but it might take a while to get there. I believe that the supply is far too strong for the demand, and on top of that we are running out of storage space worldwide and as a result it makes a lot of sense for the downtrend to continue.
The $2 level above should continue to be a bit of a resistance barrier, and with that I believe that anytime you see an exhaustive candle it’s an opportunity to start selling again as the bearish pressure should continue going forward. At this point in time, I don’t even have a scenario in which I am willing to start buying.
