WTI Crude Oil and Natural Gas Forecast - 22 May 2019

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WTI Crude Oil

The WTI Crude Oil market went back and forth during trading on Tuesday, as we continue to see a lot of resistance near the $63.66 level. This is a market that is looking very likely to consolidate at this point, because there is so much noise between there and the $65 level. Beyond the resistance though, there is also support underneath at the 50 day EMA that extends down to the $60 handle. With all of that being true, I anticipate that we are looking at a range bound market that will simply chop around. This is good for short-term traders though, as I believe that we don’t really know where to go with tensions in the Middle East perhaps driving the cost of crude oil higher, but at the same time a potential trade war driving down demand.

Crude oil

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Natural Gas

Natural gas markets fell during trading on Tuesday, drifting down towards the $2.61 level rather rapidly. The $2.60 level should be support, and therefore we could see a little bit of a bounce from there but I fully anticipate that eventually we will break through it and go looking towards the $2.50 level which has been such a major floor in the market. Beyond the bearish candlestick, we also have the 50 day EMA that has acted as resistance, so ultimately I think it makes sense that we continue to see sellers.

In the short term, I expect that the $2.70 level is essentially the ceiling in the market as well. With that, I would focus on short-term charts that show little rallies that can be faded based upon exhaustive candles. You are probably going to have to play short-term time frames as although this is a very negative market, the risk to reward ratio is favor 15 minute charts and the like.

Natural gas

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.