WTI Crude Oil
The WTI Crude Oil markets pulled back initially during the trading session on Monday, breaking towards the $67 level. That’s an area that has been resistance in the past, so it’s not surprising that we turned around to form a bullish candle. It looks as if we are going to reach towards the $70 level above, which of course is a major round number. That major round number should continue to offer value that you can take advantage of, in the form of resistance. However, as soon as we break above there it looks like we are likely to go to the $72.50 level, which is my longer-term target. There’s an uptrend line underneath that should continue to be the “floor” in the market, and if we were to break down below there, the market would unwind rather rapidly, without a doubt tackling the $60 level initially.
Natural Gas
Natural gas markets went back and forth during the trading session on Monday, as we continue to hover around the $2.75 level. The market looks likely to try to go higher based upon the candle shape, but I believe that the $2.80 level is massive resistance. If we can break above there, I think that we could go higher, perhaps reaching towards the $3.00 level above. That is an area that even more resistive, so I am waiting for exhaustive candles on short-term charts to continue to short the natural gas markets, as we are so tightly wound up. I do believe that the oversupply issue continues to be a problem, and that of course the temperatures in the United States and Canada are starting to turn higher, and that drives down demand significantly in the natural gas world.
