The WTI Crude Oil market rose during the session on Tuesday, clearing the $60 level easily. Because of this, I believe that this market is getting ready to break out to the upside and perhaps grinding out a sigh and $70 over the course of the next couple of weeks. I believe that short-term traders will continue to enter this market on short-term pullbacks, as buying is the only thing that you can do at this point. Yes, 5 sessions ago we formed a nice-looking shooting star, but at the end of the day we had already broken out at that point. This simply signaled that a pullback was probably coming, and we have already gotten it. Now that we have proven this market bullish again, there’s no reason to think that we won’t continue to go higher.
Looking to buy pullbacks
I will continue to look at short-term charts, in order to buy pullbacks. I believe that things are coinciding nicely with sudden strength in the Canadian dollar, which tells me that perhaps the oil markets are leading the Forex markets. With that, even if you don’t trade the commodity space, the truth is that it has ramifications in several currencies pairs.
I still believe that this market is one that will be bullish over the longer term, and we have in fact seen the bottom. If you look at the pattern towards the bottom of the chart, we have essentially formed a “W” pattern. That’s one of the more bullish patterns that you can see as far as a reversal is concerned, and with that I am definitely looking to go long. In fact, I don’t really have a scenario in which I want to short this market, unless of course we break back below the $55 level, which is something that’s looking increasingly unlikely. Crude oil prices are going higher, and considering that it’s the precipice of the summer driving season in the United States, this makes complete sense as the seasonality of this market tends to be bullish in those months.
