WTI Crude Oil
The WTI Crude Oil market had a very negative session during the day on Thursday, as we broke down through the $46 level. Because of this, the market looks as if we are going to go lower, and we have recently broken down below the bottom of a descending triangle which of course is a negative sign. With this, the market will more than likely try to reach towards the $43 level, perhaps even lower given enough time. With this, I believe that the rallies coming forward should be selling opportunities and as we have a bit of inherent weakness in this market. It is not until we form some type of longer-term buy signal that I would even consider buying this market.
Natural Gas
The natural gas markets went back and forth during the day on Thursday, forming a slightly negative candle. However, we did break above the top of the previous hammer, so that is a bullish sign overall. This is a market that’s very strong in general, and as a result I have no interest in shorting this market at all. I believe that we can break above the top of the range for the day on Thursday, this might be reason enough to start going long, especially if it’s in reaction to the Nonfarm Payroll Numbers.
At this point in time, I would anticipate that the markets going to try to get to the $3 level, and that pullbacks should be supported all the way down to at least $2.50. In other words, this is essentially a “buy only” market unless we get some type of longer-term sell signal on the weekly chart. At this point in time, I do not see that happening yet. However, it will of course reevaluate things after the close today, and see if the attitude has suddenly changed.
