WTI Crude Oil And Natural Gas Forecast - Monday, Jan 23
WTI Crude Oil
The WTI Crude Oil market rallied during the day on Friday, as we gapped higher at the open. However, I see a significant amount of resistance above, so I think it’s only a matter of time before we fall. In fact, by the end of the day we started to see a little bit of weakness and I am looking for exhaustive candles in order to take advantage of what I think is a serious problem with oversupply. The strengthening US dollar won’t help things either, and with this being the case I am looking for continued consolidation. We are getting towards the top of that consolidation, so it makes sense that perhaps we pull back a little bit.
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Natural Gas
Natural gas markets tried to rally on Friday, but found the area above to be a bit too resistive. We ended up breaking below the $3.25 level, now it appears that natural gas markets are going to try to reach towards the $3.10 level underneath. Because of this, expect more bearishness and short-term rallies can offer selling opportunities. Once we get below the $3.10 level, the market should then reach towards the $3 level. I do not believe in buying natural gas, although I do recognize that a gap wasn’t filled yet. However, we did test the bottom of that gap, and sometimes that’s as good as it gets. Because of this, I believe that the sellers are still firmly in control.
Looking to short-term charts for selling opportunities will more than likely be the best way to trade this market going forward, and I believe that there is a big fight below at the $3 level just waiting to happen. Once we get below there, the bottom in this market will completely fall apart. Warmer than anticipated January temperatures in the northeastern United States continue to work against the value of natural gas.
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Disclosure: None.