Crude Oil Price Outlook – Crude Oil Continues to Defend The Same Level

WTI Crude Oil Technical Analysis

The light sweet crude oil market has rallied slightly in the early hours on Friday as it looks like we are hanging around to show signs of resiliency here in a three-year support level. Market participants are probably just simply either covering their shorts or trying to play a short-term bounce, but this is a technical bounce. Nothing has fundamentally changed, and we are still looking at the very real possibility of a recession.

That, of course, will bring in less demand for crude oil, so pay close attention to that. On a bounce, we could go all the way to the $70 level and while it would be a good short-term trade, it really wouldn’t change much. Again, if we break down below the Wednesday candlestick, that could open the trap door to $65, maybe even lower.

Brent Crude Oil Technical Analysis

The Brent market looks very much the same as it is defending the $70 level. And this is also where it has been supported for roughly three years. A bounce here could go all the way to the $74 level at this rate. A breakdown below the Wednesday candlestick would, of course, be very negative as it could send Brent looking for $67.50.

And I do think it’s the same scenario here. We’re just looking to take advantage of cheap oil. It’s a quick term, short term, quick trade, if you will. And as a result, I think traders are looking to just play the bounce, probably not hang on to the position. Quite frankly, we would need to see the fundamentals change completely.

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