- The light sweet crude oil market has been very noisy at the moment, as headlines coming out of the Middle East should continue to be a major factor here.
Light Sweet Crude Oil
The light sweet crude oil market continues to be probably the main focus of most retail traders right now, which makes sense considering that there is a conflict in the Middle East that is stubbornly stagnant in the sense that there is no real movement towards a true ceasefire that we see so far.
With that being the case, I think that does put a little bit of a bid in the crude oil market in general as it should. With the Strait of Hormuz being essentially closed due to insurance cost, it does greatly influence what happens with the price of crude in global markets.
The light sweet crude oil market will be a bit of a laggard though, simply due to the fact that the United States is somewhat energy independent and this is a US based oil product.
Targets and Support Levels
Over the longer term, I think we probably go looking toward the $100 level, which is a large round psychologically significant figure and therefore it does attract a certain amount of attention. If we can break above there, then it opens up a move to the $115 level, but I’m not really looking for that quite yet, barring some type of escalation.
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To the downside, I see the $85 level as a potential floor. It’s also right around where the 61.8% Fibonacci retracement level sits and with this being the case, I think it is probably only a matter of time before you would have value hunters.
I don’t like shorting this market, but I believe that we have a range that is getting pressed. I think overall, you have to look at this through the prism of value hunting and playing what you’re given and right now it’s about a $15 range.
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