By FX Empire.com
Light Sweet crude
The CL contract had a negative day on Tuesday, but did bounce towards the end of the US session to form a hammer on support in the form of $90. The level was significant resistance previously, and it should be significant support now. However, with the headline risks out there, it is very difficult to hold any risk asset for any great length of time. If we break the top of the Tuesday range, we would be long of this market, but only for a short-term trade. If we close below $90, we might be interested in shorting as the market would reenter the $80 – $90 consolidation range.
Brent
The Brent market has been consolidating over the last couple of weeks, and on Tuesday finally saw a breakthrough – to the downside. However, the end of the session saw a bounce, and we closed above the bottom of the range, and even printed a hammer. Because of this, we think a break of the highs from Tuesday is an opportunity to go long until we hit the top of the range at $112.50 or so.
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