The WTI Crude Oil markets fell yet again during the session on Wednesday, plummeting down to the 92.50 support level again. This area has been tested a couple of times now, and the fact that we have fallen all the way down here does in fact suggested me that the sellers are going to finally break this market down. Below here, I would suspect that the next move will be down to the 90.00 handle, which is an area that I anticipate quite a bit of buying. That being said, this market simply cannot get out of its own way.
The sellers will continue to come out every time there is a little bit of a rally in this market, and as we have fallen so hard in such a short amount of time, it’s probably the best way to play this market. Simply fading the rallies as they come on the first signs of weakness is probably going to be the “safest”, if not the most logical way to be involved in this market.
Nonfarm payroll and its effect on the petroleum markets.
The nonfarm payroll numbers are coming, and they will have an effect on this market, as well as other grades of petroleum. This is because the jobs situation in the United States could very well dictate what the Federal Reserve does next as far as tapering off of quantitative easing is concerned, which of course affects the value of the US dollar in general. Remember, the US dollar is what this contract based in, so it makes sense that the higher the Dollar goes, the less of it takes to buy this commodity. However, that is and always a case, and the market could look at a strong jobs number as a sign of potential demand for energy out of the United States which is one of the two largest consumers of energy in the world. That being said, a move below the 92.00 level on a daily close since this market down to 90, while any bounce should run into significant trouble and 95.50 or so.
