WTI Crude Oil
The WTI Crude Oil market initially fell during the trading on Wednesday. The market bounced though, forming a bit of a hammer. That’s a sign that we are probably going to go towards the $69.50 level again, and then perhaps the $70 level after that. I think that short-term pullbacks continue to be buying opportunities, and that the $66 level should be supportive as well. I believe that the uptrend line on the daily chart should continue to support this market quite well. The oil markets are benefiting from tensions in the Middle East, and that of course allows the market to go higher, and if we can eventually break above the $70 level, we should go to the $72.50 level. If we were to break down from here, it’s not until we drop below $64 that I would be looking to short this market.
Natural Gas
Natural gas markets had a choppy session during the Wednesday trading day, ending up almost unchanged. The $2.80 level above continues to offer resistance, so I think that a breakdown below the bottom of the range for the session on Wednesday is a signal to start selling again, but I also recognize that there’s a lot of support below, especially near the $2.60 level. The market should continue to be volatile in general, as natural gas is typically traded on a week by week basis. If we did break above the $2.80 level, I think that the market could go a bit higher, but I believe the $3 would bring in a ton of resistance as well. At this point, I think it’s easier to sell signs of exhaustion or breakdowns than anything else as buying this market is going to be difficult, unless we get the break above the $2.80 level and you are willing to babysit a short-term trade.
