After challenging higher prices on Thursday near 73.000 USD, WTI Crude Oil started to selloff and by Friday’s close the price of the commodity was near 70.610.
- WTI Crude Oil traders were given a strong dose of clarity last week when Donald Trump emerged as the U.S President-elect.
- Trump who is known for his strong U.S energy policies, likely means American producers will become more active if they choose, and certainly means the price of WTI Crude Oil will be effected due to changes of perception.
- The commodity did, however, rise to nearly 73.000 USD on Thursday, but after this push higher the price of WTI Crude Oil started to decline and going into the weekend values were close to 70.611.
The ability of WTI Crude Oil to go into the weekend with sharp declines positioned the commodity within eyesight of lows seen on Wednesday when a price of 70.000 was approached. Two strong buying surges were seen in WTI Crude Oil after the election of Trump. What now needs to be questioned is why the price of the commodity was able to jump rather fast after as written above, because it would seem the U.S is about to embark on a more proactive U.S energy platform.
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Speculative Push Followed by a Decline
During the time Donald Trump was President in his first term, the price of WTI Crude Oil did not climb above 77.000 USD per barrel for any great length of time. In fact it appears per a technical chart the price of the commodity found a fairly steady range between 65.000 to 75.000 USD from 2018 into 2019. Yes, in 2020 there was coronavirus and the price of WTI Crude Oil sank to below zero in the futures markets briefly, but that was a Black Swan event and is hopefully not going to be repeated under any circumstances.
The election of Trump doesn’t mean the price of WTI Crude Oil is going to decline with a steep decline suddenly, but it likely means production of the commodity will become more secure regarding supply. The ability of WTI Crude Oil to trade below 75.000 USD during most of Trump’s previous term in the White House is an interesting fact speculators should consider moving forward. The push higher on last Thursday was strong, but it did meet with swift selling and it is likely the speculative push higher was merely that, an attempt to push the price of WTI up and then failed.
Support Levels in Sight as Behavioral Sentiment Adjusts
As WTI Crude Oil opens this week it will be of keen interest to see what the commodity does on Monday. Trump will not take over the White House until the 20th of January 2025, but certainly his policy which insists on strong production from U.S energy suppliers is known and will continue to be heard.
The price of WTI Crude Oil is close enough to 70.000 to likely cause some speculators a taste for wagering the level is going to be challenged in the coming days.
Day traders should not bet blindly and risk management is needed in WTI Crude Oil.
If 70.000 is broken lower and sustained, this will become quite interesting and where potential support is will become a wagering question.
WTI Crude Oil Weekly Outlook:
Speculative price range for WTI Crude Oil is 67.000 to 72.300
Technical traders in WTI Crude Oil may not want to believe the election of Trump will effect the value of the commodity so abruptly, and perhaps they are correct short-term. However behavioral sentiment in the broad energy sector will definitely react to the proactive policy changes that will come from the U.S regarding drilling and exploration for more resources.
The price of the commodity which it is already supplied well globally, will likely stay within a relatively known price range and resistance levels should be watched as a possible place to launch selling positions. Retail traders looking for price action lower should not get overly ambitious and be willing to cash out profits when price targets have been hit. The price of WTI Crude Oil will likely trade in a secure price band, but this week of trading may still look for proof of equilibrium as Trump’s victory is digested.
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