WTI Crude Oil and Natural Gas Forecast - 7 September 2018

WTI Crude Oil

The WTI Crude Oil market broke down rather significantly during the trading session on Thursday, showing signs of extreme weakness. We broke down below the $67.50 level on disappointing inventory numbers and of course concerns about trade wars driving down demand. At this point, the uptrend line crosses the $65 level, so I think at this point longer-term traders will be down there looking to pick up a bit of value. If we break down below the $65 level, the market could break down even further, but at this point I think we are going to grind to the downside. Clearly, we have a lot of issues and of course a stronger US dollar weighs upon the crude oil markets as well. It currently looks as if the $71 level above is the “ceiling” in the market. With today being the jobs number, expect extreme volatility.

Crude oil

Natural Gas

Natural gas markets have broken down a bit during the trading session on Thursday, reaching down towards the $2.77 level as I record this. The $2.75 level underneath is support, and a break down below there opens the door to the $2.70 level which is the bottom of the overall consolidation. I think that in the short term, small rallies that show signs of exhaustion should be selling opportunities. However, longer-term traders will look at the $2.70 level as an opportunity to pick up value. We are still in the overall consolidation area that I have marked on the chart, and as a result is very likely that the market continues to do the same thing that is done for quite some time.

Natural gas

Christopher Lewis

Christopher Lewis has been trading Forex for several years. He writes about Forex for many online publications, including his own site, aptly named The Trader Guy.