The WTI Crude Oil markets tried to rally during the session on Monday, but as you can see were repelled yet again near the $95 level in order to pull back and form a shooting star. The shooting star of course suggests weakness, but we have seen quite a bit of consolidation in this area, and I am a bit concerned about shorting here simply because there is so much noise on the longer-term charts just below this particular area.
With that being the case, I am a bit hesitant to get involved in this market, especially when you look at Brent, which is much more clear and the fact that we have two hammers in that particular grade of crude oil. With that being the case, I feel that the WTI Crude Oil markets will be an under performer, but the fact the Brent markets look somewhat supported does suggest to me that we could see a bit of a bounce from here.
Mind the gap
There is a gap at the $96 level in this market though, and that has to be paid attention to. With that being the case, I am hesitant to start buying into we clear that level, but a break above the $96 level would indeed be very bullish. At that point time, I would expect this market to head back to the $98.50 level, and then possibly the $101 level. All along the way though, you would have to be cognizant of the fact that you're going against the trend, and that a pullback could be very possible, if not likely.
With that in mind, I am actually looking to sell rallies as soon as they show signs of weakness. A resistive candle at one of the aforementioned levels would be more than enough of a reason for me to start selling this market again. In the meantime though, it would not surprise me at all if this market simply grind sideways over the course of the next several sessions. However, keep an eye on the Brent market as well, because of it breaks to the upside, it could very well drag this market with it.
