The light sweet crude market had a slightly positive session on Tuesday as the $95 level continues to hold as support. However, until the speech by Federal Reserve Chairman Ben Bernanke is given on Friday, the “quantitative easing trade” will keep this market fairly quiet. Will we mean by this is that the Dollar part of the equation will still be a mystery.
If we can get down below the $88 level, it looks like we could see a serious momentum to the downside. However, there is still quite a bit is support at places like $85 and $84. On the upside, we see the $100 a barrel level as being fairly resistive, and will probably give way in order to open the door to the $105 level. We simply look to trade this market on a breakout of the current range to the upside, which would have us buying at roughly $98, and selling just below the $88 handle.