WTI Crude Oil
The WTI Crude Oil market has been slightly positive during the trading session on Tuesday, as we continue to grind towards the $65 handle. That’s an area that has a certain amount of psychological resistance, but I think we could break above there. Once we do, the market should go to the $67.50 level, as it is the next major barrier. Pullbacks of this point should continue to be a momentum building exercise, especially down near the $62.50 level. I think that the overall uptrend continues, especially if the US dollar continues to fall. If we break down below the $62 level, that sends the market down to the $60 level next, and then eventually lower than that. Expect volatility regardless, but it looks as if the buyers are still going to be aggressive.
Natural Gas
Natural gas markets have initially fallen during the day on Tuesday as well but turned around to rally again. Natural gas markets are a bit thin and reaching the top of an overall consolidation area that goes back well over year. Although it is short term bullish, I am a bit concerned once we get closer to the $3.40 level, as it was massive resistance at the beginning of last year. I suspect that we are getting towards the end of the seasonality that tends to help the natural gas markets, and most of these moves are based upon weather reports for the next week or so. Given enough time, I think we served to focus on spring coming back to the northeastern part of the United States, and that will drive demand much lower. We don’t have the signal yet, so I’m not willing to start shorting, but I am willing to be patient enough to wait for a selling opportunity.
