WTI Crude Oil
The WTI Crude Oil market bounced off of the $49 level during the course of the day on Thursday, but found resistance at the $50 level above. With this being the case, the market looks as if it is going to go back and forth and chop around in general. If we can break above the $50 level, that would be very bullish, and it should send this market looking for the $52 handle. A break above the $52 level would of course be a very bullish sign as we should go higher over the longer term. On the other hand, if we break down below the $49 level, the market should reach towards the $46 level underneath that. With this being the case, I’m waiting to see whether or not we will break down or shoot to the upside. Between now and then I am sitting on the sidelines.
Natural Gas
The natural gas markets of been extraordinarily volatile over the last 24 hours, but it looks as if we are hovering around the $3 level. This is an area that has been both resistance and support, so I think we need to make a decision from here. If we break down below the uptrend line that had been violated previously, we could break down significantly. On entering, we break above the top of the range for the day on Thursday that would be a very bullish sign.
With this neutral candle, it’s likely that we will see quite a bit of choppiness and of course we have quite a bit of confusion at the moment as we have seen such a volatile move. However, given enough time I do think we have to continue one way or the other. The extraordinarily bullish candle is a real concern for the sellers, but then again if we break down again, that would show quite a bit of strength by that very same group. If we break above the top of the candle for the day Thursday I have a target of $3.30 level.
