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WTI Crude Oil
The WTI Crude Oil market fell slightly during the course of the session on Tuesday, but turned around to form a bit of a hammer at the $50 handle. If we can break above the top of the hammer, the market should then reach towards the $51.50 level. If we can break above there, the market should continue to go much higher and reaching towards the $55 level after that. I believe that the $49 level below is massively supportive, and as a result I don’t have any interest in selling until we break down and close well below there. If we do, the market should then reach down to the $47 level. I think at this point in time though, it makes sense that the buyer will return to this market again and again, so I don’t really have any interest in selling at this moment. I do recognize that it will that longer-term we may have serious oversupply issues.
Natural Gas
The natural gas markets rallied during the course of the session on Tuesday, but then turned right back around to form a shooting star. At this point in time, I recognize that the $3 level below should continue to be supportive, and with that being the case I think there’s plenty of room to move to the downside and find plenty of buying opportunities. A supportive candle would be reason enough to go long, and I believe that the 50-day exponential moving average in the previous uptrend line should continue to offer support psychologically below as well.
At this point in time, I believe that the market should continue to grind higher and perhaps reach towards the $3.40 level over the longer term as it is a large area on the longer-term charts, and of course will be a target for money.
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