By FXEmpire.com

The Light Sweet Crude market fell hard for the week overall as the market searched for the $95 support level. Most of this move was on Friday as the jobs number came out relatively weak in the United States. The $95 level is one of the ones that we are most interested in, and feel that it should be a longer-term support level that the market will have to come to terms with.

The level is the “line in the sand” as far as we are concerned, and will only sell if we break below it. The weekly candle does look very weak, and we have to admit that the bullish case is being shipped away by it. However, the level hasn’t been broken yet, so we feel that there are going to still be questions about the trend.

The OPEC Finance Minister stated during the week that the group didn’t like the idea of oil being over $100 a barrel, as it would more than likely cause demand destruction. The demand part of the equation has been one that the oil traders have been worried about lately, as there are now 11 European countries officially in recession.

The emerging markets were the source of demand that the markets looked to recent, but the reality is that China is also slowing down slightly. (Albeit very slightly.) The Indian economy is slowing as well, so there will be concerns about demand going forward. However, there is a very obvious support level at the $95 level, and the markets will more than likely have people will to step in at that point. Also, one would have to think that OPEC won’t let the market fall too far either.

With all of this in mind, we are watching the $95 to $98 level as a potential entry to the long side at this point. After all, even with the bearish factors above, there are still plenty of Middle Eastern headlines waiting to happen, all of which would drive prices higher. This is also in conjunction with the numerous support levels that go all the way down to the $95 mark. We need to see a supportive candle at the end of this week to buy. If we close sub-$95, we are sellers.

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Originally posted here