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WTI Crude Price Analysis


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The WTI Crude Oil price action today was amazing to watch and I did not expect such radical moves even with the government releasing inventory data which is customary for Wednesdays. My intraday Daily Targets indicator gave a decent 57.84/56.24 reading and although I considered the range normal for a news day. I had technical expectations that a drop below the pivot point of 56.80 would likely trigger a move lower. After the news, we did move lower as expected and then the knee-jerk move back up was what caught me entirely off-guard as we ran into a wall of resistance in the 5792 area and fell right back to where we had fallen earlier.

While the main trend is up according to the daily swing chart, I believe we are looking at some form of trend exhaustion here from the run up and no real change in trend. Sellers amassed in greater number at that 57.90 area today then there were buyers lower. On a continuous contract basis, the real true resistance is from very earlier in the year when prices were in the mid-58 level. If we breakdown below 57.10 and stay below here but above 56.20, we would be safe for the buying to continue and take prices much higher. Below 56.20 is a bit bearish and this could lead to a 2-3 day price adjustment to the downside, yet not safe enough to call this a correction.

The range in this move is from the low in the third week in October at 50.87 to the high of 57.92 made earlier today. The resistance is the mid-58 and could form a thin band between $58.40 ~ 58.50.A break back under the $57.10 (where we are already trading as I write this) is the first sign of weakness. A move under the $56.20 will indicate the selling is getting stronger and that sellers are taking control.

Again, the primary range is between $50.87 to $57.92. Its retracement zones at 50% $54.40 and the 61.80% levels is at $53.56 (see chart) are the bigger picture downside targets.

Crude Oil Nov



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Murali Sarma, Vice President of Business Integrations Inc., is an internationally known commodities analyst, author, trader and business consultant who has demystified commodity trading and introduced numerous futures trading strategies and indicators to traders - professional, non-professional and the novice trader - throughout the world. Murali began his trading career in the pre-dot-com bubble in 1998, electing to seek instruments to trade which had lesser volatility and offered more predictable analysis. From about 1999 to 2002, Murali traded out of the UK and moving to the US after that and working mostly independently with individual traders while learning from some of the best analysts and traders. While not being formally certified as a commodities trader, Murali preferred to hone in on his analysis and trading skills versus adding academically to his credentials. Murali believes that is isn’t about being right or wrong on your calls, it is about making money!

Murali has helped several traders become successful over the last 10+ years of active futures trading and has a strong following of traders who like to seek out opportunities in the futures markets on a daily basis versus following the old “buy & hold” investing adage. While not being opposed to switching hats and becoming an “investor” every so often with swing trades in the equities markets, Murali prefers to trade what he can see on charts using multiple timeframes and handcrafted indicators suited for all types of markets. Murali excels in trading sideways and choppy markets with a scalping style of being in-out of intraday markets when there is no defined trend, and on most other days prefers trading to his own computed target levels during the intraday timeframe, while following the trend.

In recent months, Murali has started a Twitter based alert service for intraday futures traders who like to trade commodities and index futures, and elected to blog post his daily analysis in commodities like WTI Crude & Gold and index future instruments like YM, NQ, ES & RTY. You may contact him via his email at info@tradeguidance.com

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