The WTI Crude Oil markets fell during the session on Tuesday, testing the $93 level. That level has offered support though, and as a result the candle does look a little bit like a hammer. This of course means that the market looks like the area will cause a little bit of a bounce, and that's exactly what I'm waiting for. After all, this is a market that has been a bit oversold, so a bounce should be coming fairly soon. However, this bounce won't necessarily signify anything beyond a selling opportunity at higher levels.
All that being said, this market does look like it is one that will continue to fall over the longer term. I don't know that we can get below the $90 level, because quite frankly the United States does not look ready to taper off of quantitative easing anytime soon. And should continue to weaken the US dollar overall, and eventually commodities will pick up as a result.
Nonfarm payroll numbers this Friday
The nonfarm payroll numbers coming out this Friday of course will be very influential in all financial markets, but this could be one that's especially sensitive, simply because the jobs number will not only affect what the Federal Reserve does as far as tapering off of quantitative easing the US changing the value the dollar, but it also gives us some insight as to what the potential demand for energy will be in the world's largest market.
Because of this, I would expect any bounce to be somewhat muted at this point, and it's going to be difficult to imagine that this market is going to take off between now and Friday. However, if we do get above the $98 level, I would be fairly positive that this market would head to at least $100, and possibly even as high as $108 over the longer term. In the meantime though, perhaps options might be the best way to play this market, or at least just treating it more or less as an area where the market will bounce around for short-term trades.
