WTI Crude Oil
The WTI Crude Oil market has been very negative during trading on Wednesday, slicing through the $65 level. It looks as if the market is ready to go down towards the $63.50 level, but at this point, I think it’s only a matter of time before the value hunters will eventually come back. I’m looking at selling short-term rallies, but I recognize that we will get the occasional support about. We broke through a major uptrend line a couple of days ago, but I recognize that there are buyers just underneath. One thing that I would point out is that the market closed at the very bottom of the range for the day, typically a very negative sign. Pay attention to the US dollar, as it can have a major influence on what happens here as oil is priced in that currency.
Natural Gas
Natural gas markets gapped higher to kick off the trading session on Wednesday and then reached towards the $3.30 level. That, of course, is an area that seen a bit of resistance recently, and therefore I think that we probably have sellers coming into the market just above. I would look for some type of exhaustive candle to start shorting, perhaps for a move back down to the $3.20 level. I like the idea of trading short-term charts with an eye on the $3.30 level, which is the middle of this overall consolidation that we look to be trying to break below.
If we break below the couple of hammers from a few days ago, then I think the market goes down to the $3.10 level, and then eventually the $3.00 level after that. Obviously, that would be a very negative turn of events.
