- Crude oil continues to be very noisy, as we are trying to sort out the next trading range.
- So far, it seems to be holding.
The West Texas Intermediate crude oil market is down quite a bit during the trading session here on Thursday as the $66 level continues to offer a major resistance barrier.
Ultimately this is a market that I think is in a state of flux as it is trying to figure out what to do about the next move going forward as there are a lot of talks between the Americans and the Iranians which of course will have a major influence on what goes on in the Middle East.
But at the same time, we have a situation where we are trying to sort out whether or not we are going to move higher into the summer range or if the summer range has been found. Keep in mind that there is a lot of production out there right now which is moving against the idea of potential American strikes against the Iranians which really history shows us they won't trash the oil network anyway.
Top Regulated Brokers
Playing the Edges
So, I think you've got a scenario where it's very difficult to break out. I look at the 200-day EMA as well as the $62 level underneath to offer support while the $66 level offers resistance.
In other words, I think this is a short-term traders' type of environment where you can probably do quite well going back and forth in some type of sideways system along the lines of using stochastic oscillator or maybe just simple price action on short-term charts.
If we break out of this $4 range, then I think you've got a bigger move just waiting to happen but as things stand right now I think it's a little bit much to ask and therefore you have to just play the edges until something breaks.
Ready to trade our weekly forecast? We’ve shortlisted the best Forex Oil trading brokers in the industry for you.