The WTI Crude Oil market initially rallied during the session on Wednesday, testing the $93.00 level. However, we found the marketplace to be a bit resistive, and as a result the market fell back down in order to form a shooting star. Shooting star of course suggests that there is still negative pressure in this marketplace, and because of that I believe that we are going to test the support at $90.00. That area of course is a large, round, psychologically significant number, so it is very likely at that it’s going to take something significant to get below there.
With that being said, it very well could be the nonfarm payroll report that comes out tomorrow that moves this market. We may have a fairly quiet session but I feel that any rallies at this point time would have to be treated with suspicion, making it a “sell only” type of contract right now. That’s not to say that things can change of course, but I believe that the nonfarm payroll numbers will have a significant effect on this market.
Energy continues to fall overall.
As I look around the various markets, I noticed that energy in general is suffering. Part of this is due to the stronger than anticipated US dollar, but part of it is also due to the lack of demand worldwide. Simply put, the economic conditions around the globe don’t warrant higher energy prices at this point in time. This isn’t to say that the market can go higher from here obviously, just that it won’t do so aggressively.
With that, I feel that this market can be shorted every time it rallies on short-term charts, and may be more suited for binary options than the actual futures market. Obviously, the announcement on Friday will have a great influence on potential demand in the United States, and that of course has a large amount of influence on what happens next in this market. That being said, I look for today to be a relatively quiet session, probably relegated to very short-term trades.
