The WTI Crude Oil markets had a positive session on Thursday, as we continue to bounce around in rather radically. The daily candle formed a bit of a hammer, and as a result it looks like we are going to head back towards the top of the recent consolidation area. I see this market as being "stuck" between the $92.00 level on the bottom, and the $97.00 level on the top.
I think the possibly we are going to be in this range for some time now, as the markets head towards the summer doldrums. The summer range could be this $5.00 range that we have seen over the last couple of months, so I think that this market will be very difficult to trade for anything more than a very short-term trade from time to time.
In fact, I feel that it is more or less a tertiary indicator of the USD/CAD pair, or possibly even the USD/NOK pair. The oil markets are going to have a greater effect on the currency markets than the other way around I believe. This market will of course be very interesting if we can break out of this range, but in the meantime I am going to be able to take advantage of this range for short-term trades and use it to accentuate the profit that I have been making in other instruments lately.
What will finally make this market breakout?
If we can break out of this range, I think that the move will be rather significant, but until that happens it's going to be difficult to hang onto the trade for more than a day or two tops. Based upon the candle that we formed for the session today, I certainly believe that a break of the highs for the session should send this market looking for the $97.00 level. I am more than willing to take profits before we get to that point though, as settling for 80% of the range is a much safer way to play this market been trying to pick off the top tech, or the bottom one depending on which direction we are heading.