The WTI Crude Oil markets did almost nothing during the abbreviated session on Thursday, and remains just below the $92.50 handle. What I find most interesting about this market is the fact that we broke down below the recent support area, and as a result it does look like more weakness is coming into it. However, I am a bit hesitant to start shorting here simply because the longer-term charts to show a lot of noise between here and $90, which of course means that we will more than likely have a very difficult trading going to the downside.
On the upside, I see far too much in the way of resistance to be bothered doing that as well, and as a result find myself on the sidelines in this market right now. However, I do see that if we get above the $96 handle, this market could go to about $98.50 very little in the way of resistance.
Federal Reserve (Still)
The Federal Reserve is still in focus, with the world wondering whether or not it can taper. This would of course bring up the value of the US dollar, which in theory would bring the market down overall. The jobs numbers will be watched, and will move the markets every time they come out. The better the jobs numbers, the more likely the markets think the Federal Reserve tapers. However, there has to be a “bottom” of the run lower, and I think we are getting closer to it at the moment.
The $90 level is significant support on the long-term charts, and as a result I think this market only has so much in the way of downside potential. Certainly, we could have that move, but I think that it will take quite a bit to get lower as the level is so supportive. With that, I think we fall, and then bounce on some type of supportive candle. I am more apt to take that supportive candle than try and fight the downside at this point in time.
