By FXEmpire.com
The Light Sweet Crude markets fell hard during the Friday session as the Non-Farm Payroll numbers came in at a light 110,000 jobs added in America for the month of April. The fall for the session was very violent, and sliced through what would be considered the “easiest” of the support levels all the way down to the $98 level.
The $95 level is a real “line in the sand” for us as far as staying bullish of this market. The area below is simply far too congested with potential support levels for us to be comfortable selling at this point, although it certainly looks as if the market will have plenty of selling pressure in the short-term.
OPEC officials were quoted as mentioning that the cartel was worried about oil prices being over the $100 level, as it could cause demand destruction. The market started falling after these comments in the middle of the week, and the poor jobs number from the US only added to what was already a nervous market. However, there is a real chance that this was simply a knee-jerk reaction and that the market will more than likely rise once stable.
The overall trend is up as far as we can tell, and we choose to buy only at this point. However, we understand that buying at current levels is probably asking for trouble. The several levels below could provide a supportive candle on the daily chart for us to go long of this market with, and this is exactly what we are waiting for.
The markets rarely fall like this without at least a little bit of follow through. This is why we will more than likely be flat in this market for the next day or two. The $95 mark would be a great place to see a hammer or a bullish engulfing candle in order to get involved with. However, if we get a daily close below the $95 level, we would have to be sellers at that point as it would show real follow through by the bears.
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Originally posted here
