Crude Oil Price Forecast – Crude Oil Markets Continue to Stall at Same Levels

Christopher Lewis
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WTI Crude Oil

The West Texas Intermediate Crude Oil market has gone back and forth during the trading session on Monday, as we continue to see the 50 day EMA offer issues as far as resistance is concerned. Furthermore, the $30 level above is going to offer a significant amount of psychological and structural resistance, so therefore I would not be surprised at all to see this market pullback.

What is worth noting is that Saudi Arabia has cut back production by 1 million barrels again, and the market gave back all of the gains it had based upon that. By showing this weakness, it shows that the market does not quite believe that demand is going to catch up anytime soon, and quite frankly lower prices are more likely than not.

Crude Oil Video 12.05.20

Brent

Brent markets did the same thing, showing that they could not rally after that announcement, and quite frankly they cannot rally then, then the question becomes when can they? Ultimately, this is a market that should go looking towards the $25 level, possibly even the $20 level after that. If the market breaks above the $35 level, then it has the possibility of running towards the $40 level, but quite frankly I do not see that happening anytime soon. The market is very likely to continue seeing a lot of volatility, but the fact that we cannot rally after a 1 million barrel cut for anything more than a short-term move tells you all you need to know about where we are going next given enough time. I remain bearish after seeing this lackluster reaction to massive cuts.

This article was originally posted on FX Empire

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