- The light sweet crude market did gap higher to kick off the trading session here on Friday, only to turn around and fall by falling the way it has.
- We have filled the gap, but we've also seen buyers come back in and support this market.
- As I recorded this video, we are reaching the $66 level, which is an area that had previously been resistance.
I would also point out really at this point, what we're looking at is a market that is testing an area near $65 and $65 I think ends up being the epicenter of all of this noise.
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On a Move to the Upside…
If we can clear the $66 level, then it's likely that crude oil will continue to go higher. All things being equal, this is a market that I think we'll have to pay close attention to the next couple of days because if we do turn around and break down below the 50 day EMA, currently at the $64.23 level, then we fall right back into the previous consolidation range.
The market breaking above the 200 day EMA probably brings in more buying pressure and more buyers willing to get involved to chase the trade, perhaps sending crude oil all the way to $70. As things stand right now, there are concerns about supply again, although I think it's a little early to get that excited about it. We will have to watch the next couple of days to see what the market decides. And once it makes its decision, then we can perhaps follow right along. If we fall then we could be looking at a move down to the $62 level and again if we rally, then we could go all the way to the $70 level.
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