By FXEmpire.com
The Light Sweet Crude markets fell hard during the Tuesday session as the fears of a global slowdown come into play. The world worries about the situation in Europe, and as long as the US dollar continues to gain overall, this market will do the same thing as other commodity markets – fall.
The $95 level was our line in the sand for the long side of this market, and now that we are sufficiently below it – we are selling this market. The oil markets will continue to suffer as long as the Dollar continues to be the safe haven for those running from Europe. The action for the session was extremely poor, and suggests that we are going to see a move much lower. The trend is decidedly turning at this point, and it looks as if we are going to try and reach the $90 level in the near term. The support looks as if it has given way, and the bears are out in full force.
In this environment, there simply is no way to buy as the downward momentum looks set to continue. The fact that the market tried to rally on Tuesday but couldn’t hold the gains suggests that we are going to see a real capitulation in the near term, and the $90 level seems like a logical place for those that choose to step into the market and “bargain hunt”, but with this recent move, it looks as that level could even give way.
The fact that we have now broken below the lows from the New Year’s time period also doesn’t bode well, and going forward it looks as if selling the rallies will be the best play. In fact, this market should continue to offer a lot of good selling opportunities in the short term charts with the rallies simply being times when we run into minor support areas, or short covering mode. However, it is now obvious that the trend is falling, and the market is broken for the bears and away from the bulls.
Click here to read Crude Oil Technical Analysis.
Originally posted here
