The WTI Crude Oil markets rose initially during the session on Wednesday, but as you can see turned back around somewhere near the $103.50 level. This resistance was enough to form a shooting star in this market, and as a result we could see a little bit of a pullback in this general vicinity. However, I recognize that the $102 level just below is pretty supportive, and with that it’s very likely that any pullback will be somewhat shallow. Adding to that is the fact that we have a potential ascending triangle forming in this market over the longer term as you can see on the attached chart, and I believe that it’s very difficult to sell this market.
There are a couple of different things that are coming into play over the next 48 hours that could deeply affect this market as well. Today, we have the European Central Bank meeting, and although you don’t necessarily think of oil when you think of the ECB, it will certainly have an effect on the value of the US dollar over in the EUR/USD pair. Remember, that particular Forex pair is the most heavily traded financial instrument and the world, so it certainly has a drastic effect on the US dollar in general.
But wait, there’s more!
The other thing to watch out for of course is the nonfarm payroll numbers, and they come out this Friday. They drastically affect what goes on with the WTI markets sometimes, simply because a healthy jobs market in the United States means that there will be demand both from the industrial part of the economy, and of course the retail part of the economy as more and more people go to work, therefore needing more fuel get back and forth.
That being said, I think that ultimately this market really only has one direction to go. Eventually, we will find a reason to breakout to the upside but it is starting to get towards the summer months, and with that we could have a little bit of meandering over the next several weeks if not even couple of months. Regardless of, I am looking for a supportive candle in order to start buying.
