Crude Oil Outlook – Crude Continues to Look Volatile

WTI Crude Oil Technical Analysis

The crude oil markets have been very noisy and of course, the West Texas Intermediate crude oil market has pulled back from the 50 day EMA over the last 24 hours, and perhaps just as importantly, has pulled back from the $71.50 level. This is a market that’s desperately trying to find a bottom, but right now just doesn’t have one. With this being the case, I think you have to look at it through the prism of a potential value opportunity, but I would not look at this market for anything more than a short-term trade.

I am a buyer of dips, but I get out of them rather quickly, there’s not much more to this market than that at the moment. The $67.50 level underneath is the bottom of the range over the last two years, and as a result, it does make a certain amount of sense that we have seen the market react to it multiple times. The question, of course, is can we stay above it? There are enough different things going on at the moment that I think we will, but I also recognize that it will be very noisy.

Brent Crude Oil Technical Analysis

Brent markets look very much the same as they have pulled back from the 50 day EMA. Underneath, we have the $70 level offering significant support, and I think that comes into the picture as well. All things being equal, it’s probably worth noting that this is a market that also has a lot of support at that $70 level as it is the bottom of the range for the last two years.

Crude oil in general is going to continue to be a very noisy market because there are a lot of concerns about demand. Quite frankly, the economic situation isn’t as strong as some people had hoped. But at the same time, you have a lot of concerns in the Middle East, which could cause more. It’s a bit spongy and messy, but we are getting fairly close to that major support level. So, with the Brent market, much like the WTI market, I’m looking for some type of bounce for a short term long position.

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