Karpel’s Corner: Crude Crunched but Beginning to Firm Up

Welcome to Karpel’s Corner. This is where I throw out my thoughts on the markets and share some of my favorite strategies. I keep it market-focused, and never miss an opportunity to teach trading strategies and commentate on the latest trends affecting the financial markets. Hope you enjoy today’s post!

Stocks soar as the dollar continues to crush all currencies, and gold continues to fall. Oil, Light Crude Futures ($LCZ14), Brent Crude Futures ($BZ14), Oil By-Products, and Gasoline Futures ($RBZ14), are starting to base.

Worth mentioning are the futures, which provide a pure snap shot for supply and demand. The overall trends are down for Light Crude, Brent, and Gasoline. But be wary, a consolidation within a downtrend is typically bearish.

A break below the October lows could signal a continuation lower. We could then see potentially a 5-10 percent further decline.

Yes, the bears may have the edge right now, but traders should always prepare for the unexpected. If we look at December Light Crude ($LCZ14) it dipped below $80 four times in the last three weeks, only to close above $80 each time.

Watch resistance from the late October high, this would be bullish and argue for a potential bounce back to the low 90’s.

See you next time at the Corner!