The WTI Crude Oil market fell during the majority of the session on Monday, but as you can see found enough support at the $102.00 level in order to form a hammer. This hammer could be bullish, or of course could be bearish if we manage to break the bottom of it. If so, then it will become a "hanging man", and as a result it would be a massive sell signal.
I believe that this market is completely overdone considering the situation in Egypt. After all, the Egyptians are not closing the Suez Canal, nor will they as it is the one part of their economy that is functioning fairly well. Because of this, I believe that there is an excellent selling opportunity coming in this marketplace as it is far overextended at this point time, and that being the case a break at the bottom of the hammer would have me selling this market down to roughly $100.00 or so.
Going forward, I believe that this market will eventually selloff drastically, and that's essentially what I'm waiting on. After all, the world economy isn't exactly humming along, so therefore there is going to be a bit of a glut of supply.
Headlines make this contract dangerous
Unless you are an experienced trader, you have no business trading this market at the moment. Simply put, it is a fear driven market at the moment, and as a result we will see this market be very volatile. Quite frankly, I'm a bit surprised that we haven't sold off more than we have at this point in time. There is a significant amount of resistance above, and I get this feeling that the market will selloff sooner or later in that general vicinity. 105 points or zero dollars is an area that I think a lot of sellers will be interested in going forward. With that being the case, I am looking for a break of this "hanging man", or some type of potentially resistive candle above as we should see sanity come back into this marketplace that is been far too bullish.