The WTI Crude Oil market initially gapped higher on Friday, but as you can see ended up losing momentum during the day. That being the case, we broke down below the $103.00 level, and then bounced slightly. The candle formed for the session on Friday suggests buying pressure below, as it is somewhat of a hammer. That being said, I believe that this market will head to the $105 level first though, as it is the next natural resistance area as you can see on this chart.
The candle itself isn’t really much to look at, but I recognize that this market has been in a consolidation area with a slightly bullish bias. With that, the market should continue to go higher given enough time, and I believe that we will ultimately test the $107.50 handle before it’s all said and done. In fact, I believe that we go above there eventually and head towards the $110 handle.
Buying pullbacks as they come.
At this point time, I plan on buying pullbacks as they appear, because I do believe the longer-term validity of the uptrend. It might take a while to get to the areas above that I have mentioned, but ultimately this market should make it there. It really comes down to whether or not you have the ability to hang on to the type of volatility that will almost undoubtedly see, but it is my belief that the selling will update, and we should continue much higher.
On the other hand, I think that there’s a lot of support below, going all the way down to the $97 level. Because of this, I feel that the market is still a “buy only” type of market at this moment in time, and as a result I have absolutely no interest in selling. A pullback from here should continue to attract buyers, so if we do not get the break out to the upside, I would be more than willing to buy a supportive candle for the longer-term move, one that I think will ultimately be very profitable.