Crude Oil Price Analysis: Crude Drops In Choppy Premarket Movement

WTI/CL Technical Analysis

The light sweet crude oil market initially tried to rally during the trading session on Tuesday but then fell apart to show signs of weakness. All things being equal, this is a market that I think, given enough time, does find its way back to the upside. But in the longer term scheme of things, I think we are more or less sideways. The $60 level looks to be support, and the $65 level above looks to be resistance.

So, with that being the case, I think you’ve got a situation where we just chop back and forth, trying to sort out where to go longer term. If we break down below the $60 level, there is a massive double bottom at the $55 level that I think supports the market. I still think we’re in the midst of trying to form some type of basing pattern, but we just don’t have a catalyst to go higher yet.

Brent Technical Analysis

Brent markets look very much the same, initially trying to rally during the trading session on Tuesday, only to turn around and show signs of weakness. With that being the case, I think you have to look at this as a market that is just simply hanging about, trying to determine which way it wants to go as well. We have been consolidating between $60 at the bottom and $68 at the top. And I think ultimately this is a market that will continue to be very choppy and sideways.

But if we can break above the $68 level, that’s your cue that perhaps crude oil, and specifically here, the Brent market, goes higher. This is typically a fairly decent time of year for crude oil. So, it’ll be interesting to see if we get that yearly pop. So far, it almost looks like we’re in the midst of trying to form some type of inverted head and shoulders, but we still have to work on that second shoulder.

For a look at all of today’s economic events, check out our economic calendar.