Crude Oil Forecast April 29, 2016, Technical Analysis

WTI Crude Oil

The WTI Crude Oil markets fell initially during the course of the session on Thursday, but turned back around to form a positive candle. With this, the market looks as if it is trying to grind its way towards the top of the previous consolidation area that extends all the way to the $50 handle. This is a market that should continue to have buyers every time it dips, although it will be difficult to reach the $50 handle. With this, we are bullish but recognize it is going to be difficult to hang onto any type of move, and with that being the case, we are looking to short-term charts only as we continue to take advantage of value when we drop. Below, we see the $42 level as a bit of a “floor” in this market. Ultimately, we need to recognize that this market still has plenty of upward momentum.

 

Brent

Brent markets initially fell as well during the course of the session on Thursday, but also like the WTI Crude Oil market ended up rallying later in the day. By doing so, it looks as if we’re going to try to grind to the top of the previous consolidation area from late last year, which has this market reaching towards the $54 level. That area should be massively resistive, and it will be a fight to get up there as well.

Pay attention to the US dollar, it has a massive effect on the value of oil as well, and with that being the case it’s likely that the currency will be a great influence on this commodity, but also there are concerns about supply and demand. There is the question as to whether or not drillers are coming back into the markets, but right now there is a certain lack of drillers back could continue to put a little bit of upward pressure on this market. This is a move that has been overextended for some time, so pullbacks will more than likely show themselves. However, think value when you see them.