WTI Crude Oil
The WTI Crude Oil market rallied a bit during the trading session on Friday, as we continue to see strength in the crude oil market. The falling US dollar has a lot to do with this as well as the overall demand does. I think that the market should be an opportunity to buy on dips, with the $64 level being massively supportive. I believe that we are probably going to go to the next large, round, psychologically significant number, reaching towards the $70 handle above. I think that if we do break down below the $63 level, the market probably breaks down to the $60 level. Pay attention to these levels, they give you a bit of a roadmap as to where we go next. I suspect we will probably see a little bit of consolidation with an upward bias over the next 24 hours.
Natural Gas
Natural gas markets initially tried to fall during the Friday session, but as you can see turned around and broke higher yet again. This is an extraordinarily strong move over the last several weeks, and volume has been picking up. However, the last 3 days we have seen volume peak a bit, and I think we are getting close to a major resistance barrier, especially in the form of the psychological important $3.50 level. We are getting towards the end of the high demand season for natural gas in the United States, so as soon as the temperature start to pick up, this market will probably rollover almost immediately. With that in mind, I’m very cautious about buying at this point, and I been looking to short this market on a sign to start selling. We don’t have that yet, but I certainly wouldn’t be buying at this extended level.
