The WTI Crude Oil markets fell during most of the session on Monday, testing the $95.00 level for support again. The level did of course hold, and as a result the bounce caused a hammer to appear for the daily candle. This hammer of course is generally considered to be bullish, but I have serious doubts about the area above. Granted, it does appear that we are trying to build pressure to breakout to the upside, but the $97.00 level has in fact been rather resistive more than once.
If we did managed to get a daily close above the $97.50 level, I would then be perfectly comfortable going long at that point. But until then, I see far too much potential for choppiness to be bothered wasting my money in a market that's not moving. After all, you have to think about the way you allocate capital in the markets, and whether or not it is the correct markets.
Still looks range bound at the moment
This market still looks fairly range bound to me at the moment, although I am cognizant of the fact that it appears that the buyers are putting serious pressure on the resistance area. I am not in this market at the moment, and quite frankly wouldn't be bothered. If we managed to get above the $97.50 level, I think the markets will more than likely head towards the $100.00 level. At that point in time I would expect to see an even more significant amount resistance, just simply because it is a large round psychologically significant number.
It will be have seen to see whether or not that could happen, because quite frankly there are far too many areas around the world that are still sluggish economically. Sooner or later, the supply and demand equation does come into play, and if that's the case, I can't imagine a situation where the demand is going to pick up so much that it justifies highly praised oil. Nonetheless, I don't necessarily expect a breakdown either. I fully anticipate choppy market, and am watching the $97.50 level intently.
