The WTI Crude market fell during the session on Wednesday, as we continue to meander in a relatively tight consolidation area. Because of this, I believe that this market will probably drift a little bit lower, perhaps heading back down to the $56 handle. Ultimately, I think that it’s probably easier to simply buy this market as there is certainly a significant amount of buyers underneath. After all, I think that breaking above the recent area was a sign of a potential trend change. However, I would anticipate seeing a lot of volatility over the next day or two, as the Nonfarm Payroll numbers come out on Friday. With this, there will be a lot of trading back and forth because the jobs number out of the United States can often suggest what kind of demand we can have due to industry, and of course personal consumption as people who are employed are more likely to burn gasoline.
Continued volatility, longer-term bullishness.
I believe that the longer-term trade will be to the upside, but this is not a market to be bothered with if you cannot handle significant volatility. After all, if you are to trade the futures market there is quite a bit of volatility and the tick value of course is a minimum of $12.50 via futures contract. This is why I actually prefer trading oil via binary options or CFD markets if you have the availability. After all, with this kind of choppiness, it can get quite expensive as the market bounces between the floor at the $56 level, and the ceiling at the $62 level.
I do think that we break out to the upside given enough time, and perhaps a stronger than anticipated jobs market might be the catalyst to move this market higher. With that, I believe that you will be rewarded for being bullish, but you must be very patient. Sometimes, as Jesse Livermore once stated, we are paid to wait in the financial markets.
