WTI Crude Oil Forecast: Price Pulls Back

Looking at this chart, it’s obvious to me that we are in a strong uptrend, and I think that will continue to be the case as we have to worry about supply issues.

The West Texas Intermediate Crude Oil market pulled back a bit Friday, perhaps in reaction to being a little overstretched, or perhaps due to inflation numbers. Regardless, this is a market that has been very strong, so it does make sense that we get the occasional pullback.

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However, it certainly looks as if we have plenty of buyers underneath willing to take advantage of this market as the market offers, and I think it is only a matter of time before we reach the highs. The $120 level has been important a couple of times, and the fact that it has held during the day on Friday is a good sign. Underneath there, we then have the $115 level important as well, as it had been previous resistance. In this scenario, it’s very likely that the market will continue to see a lot of back and forth, but more with an upward tilt that anything else.

Looking at this chart, it’s obvious to me that we are in a strong uptrend, and I think that will continue to be the case as we have to worry about supply issues. Furthermore, the markets are more likely than not going to continue to see a lot of volatility as we have seen so much in the way of volatility everywhere else. Ultimately, this is a market that I think every time we do get a pullback, there are a lot of value hunters that we will continue to see a “buy on the dip” mentality.

On the upside, the $130 level is an area where we had pulled back from previously, and I think it does make a certain amount of sense that the level could offer significant resistance. If we were to break above there, then it’s likely that we would see quite a bit of a fight in this general vicinity. If we can break above there, then the market is likely to go much higher. Either way, I have no interest in shorting this market as long as we can stay above the 50-day EMA, which is currently at the $110 level. Breaking down below that level opens up the possibility of the market correcting more significantly, but that’s very unlikely at this point.