- The West Texas Intermediate Crude Oil market has initially fallen during the trading session on Thursday but turned around to show signs of life again.
- By doing so, it suggests that the market is going to continue to find buyers on this, but the 50-Day EMA sitting just above will end up offering a significant amount of resistance.
- The market breaking above there could open the possibility of a move to the $80 level, which of course is a large, round, psychologically significant figure.
On the other hand, if we were to break down below the bottom of the candlestick, it’s possible that we could go down to the $75 level in the $75 level is an area that has a lot of psychology attached to it, but whether it holds is a completely different question. If we break above there, then it’s possible that we could go investigate the $82.50 level. That’s an area where we have seen resistance previously, and it is at the top of the overall consolidation area. Breaking above that consolidation opens the possibility of a move to the 200-Day EMA. That is closer to the $85 level, and of course, is a major technical indicator that people pay close attention to, so therefore it breaks above that would probably send a lot of FOMO traders back into the market.
Don’t get Overly Aggressive
If we break down below the bottom of the candlestick, then it opens the possibility of a move down to the $72.50 level. The market participants continue to see this through the prism of consolidation as we try to figure out what’s going on with the global comedy. After all, you must worry about whether there is going to be enough demand, as everything is slowing down.
If it’s going to be the case, there is a little bit of the lid on the oil market, and right now it looks like you are better off just trading back and forth as a range bound indicator such as the stochastic oscillator may come in handy when it comes to this market. The candlestick for the day does show a little hesitation, but we are still basically in the middle of the overall range, so I don’t see a need to get overly aggressive one way or the other.
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