WTI Crude Oil
The WTI Crude Oil market rallied significantly during the day on Friday, taking off to the upside as the Americans came on board. Looking at this chart, it now looks as if the $72 level is massive support, and of course the $71 level is as it was the scene of a massive gap higher. In general, I believe that the market will probably go looking towards the $75 level, an area that makes a lot of sense from a psychological standpoint. Beyond that, if you go back far enough you can see that it is an area that has attracted a lot of momentum.
Brent markets took off to the upside as well, reaching towards the $83 level. We have seen the market break above the $82 level, which of course is a bullish sign as it had been the top of the consolidation range for the week. Friday certainly put an exclamation point on the bullishness, as we have attacked the $83 level. I think that short-term pullbacks should be a nice buying opportunity, and therefore I think that value hunters will come back into the marketplace. If the US dollar gets hammered, and it was selling off on Friday, that should help crude oil as well. Don’t forget, the Iranian sanctions go into effect in a few weeks, and that will tighten a lot of global supply, of course driving up the price of the underlying commodity. Expect volatility, but certainly with an upward slant.