WTI Crude Oil
The WTI Crude Oil market initially fell during the course of the session on Thursday, but turned right back around to form a bit of a hammer. We are pressing up against the $42 level yet again, and as a result we could very well find the market trying to grind its way higher. However, we have the meeting in Qatar over the course of the weekend, and that will most certainly have a massive effect on the markets as OPEC and non-OPEC countries discuss whether or not to do some type of production freeze.
I have a sneaking suspicion that the market has already “baked in” all of the good news, and reaching a production freeze agreement is probably already assumed in the price. It is because of this that I think we have a real danger of falling apart if the production freeze is less than thought or worse yet, completely abandoned.
Natural Gas
The natural gas markets fell during the course of the day on Thursday, continuing to show quite a bit of resiliency by the sellers. The $2 level was broken below, and that of course is a very bearish sign but is starting to become something that the market has started to use it, so I don’t feel that it is as psychologically significant as it once was. However, I still believe in the downtrend does the supply far outweighs the demand and we are getting into the springtime in the northeastern part of the United States.
The $1.90 level below will more than likely be the target, and as a result I feel that the market will eventually continue to grind lower than that, but in the meantime it looks like we are getting a little bit of a grind in general. Because of this, it might be best to trade off of short-term charts.
