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WTI Crude Oil: Weekly Forecast 12th November - 18th November

The need for WTI Crude Oil is not going to evaporate.

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    WTI Crude Oil will begin its cash trading around the 77.290 mark this week. Risk-averse buying has not developed in the commodity via any sizeable speculative positions based on global conditions and concerns about the Middle East situation. In fact WTI has fallen in value since the 27th of September when it was trading within sight of the 94.000 USD per barrel ratio.

    Yes, in the immediate aftermath of the ‘shock’ conditions in Israel which hit the global markets the weekend of the 7th of October, prices in WTI Crude Oil did climb early and culminated with a high around the 89.610 level on the 20th of October. However, in the nearly three weeks since this high, the price of the commodity has seen a rather steady progression lower.

    Lows Challenge Important Mid-Term Support in WTI Crude Oil

    The low for WTI last week happened on Wednesday when the commodity hit the 74.885 vicinity. Since touching those depths, yes, WTI has found some buying action, but the resource was not able to trade above the 77.750 mark. And the last time WTI Crude Oil traded above the 80.000 USD mark was on Tuesday of last week.

    • Economic conditions in China and Europe remain within difficult circumstances which is likely putting a certain amount of restraint on demand by manufacturers globally.
    • While nations certainly hold Crude Oil in reserves for security and future use, buying has not been done with any sense of urgency.

    Having seen lows on Wednesday, WTI did remain above the 74.000 to 73.000 price ratios which may be seen as important support by speculators within the commodity. A fall below the 73.000 price looks dangerous technically for Crude Oil and could ignite additional speculative selling positions. Yet, bullish speculators may believe the commodity is now approaching oversold territory.

    Risk Sentiment and WTI Crude Oil a Powerful Mixture

    The need for WTI Crude Oil is not going to evaporate. The price decline in the commodity comes on the heels of some analysts commenting only a month and a half ago that 100.000 USD per barrel was about to be seen again. Yet, even in the midst of the ongoing saga in the Middle East, the price of WTI Crude Oil has remained rather muted and has in fact declined. This highlights that supply remains quite stable and that large players in the energy sector are not as nervous as the ‘talking heads’ in the media regarding WTI Crude Oil.

    WTI Crude Oil Weekly Outlook:

    Speculative price range for WTI Crude Oil is 72.075 to 85.100 USD.

    As the week of trading opens it will be of interest to see how Monday and Tuesday progress. Yes, traders need to keep their eyes on the potential of developing news to suddenly get loud regarding adverse risk conditions, but if tranquility remains stable the price of WTI is likely to be calm. Having seen a low in the middle of last week and a slight push higher, speculators should question the inability of volatile reversal upwards to be demonstrated. Stability within the price of WTI and a lack of price velocity, signals traders remain skeptical about a sudden surge of buyers stepping into the commodity.

    Support near the 77.000 USD mark is important and if the price proves vulnerable another test of lows could develop early this week. The 78.000 USD level should be watched by traders too. If this higher price is not challenged early on Monday and values are sustained below this would not be a bullish. However, if the 78.000 ratio is quickly touched and prices push higher early, speculators may venture forth with long positions and aim for the 80.000 USD vicinity with the belief this is a logical target.

    WTI Crude Oil

    Robert Petrucci
    About Robert Petrucci
    Robert Petrucci has worked in the Forex, commodity, and financial profession since 1993. Important aspects of his work involve risk analysis and advisory services. As an advisor in a Family Office he maintains a conservative approach for wealth management and investments. Robert also works in private finance with investors and companies delivering financial and management services.

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