Last week’s trading was in a fairly narrow range. Neither the highs nor the lows in WTI crude oil had a significant impact on the broader value area of the previous week.
Spot WTI crude oil prices ended the weekend near $75.561, but volume was certainly minimal due to light holiday trading. Last week’s high for oil was around 78.415 last Monday, and the low for oil was when it briefly challenged Wednesday’s price of 73.810. Interestingly, last week’s high occurred very early, with the low coming just as large traders were starting to think about the US Thanksgiving holiday.
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However, a reversal began before it escaped into the long holiday weekend on Wednesday, hitting a high near 77.100 before the day was over. Trading was light for the rest of the week as volumes declined significantly. What makes the notion of Wednesday’s late rally interesting is that speculators likely believed WTI crude oil was oversold earlier in the day and were betting that a higher equilibrium would be found.
WTI crude oil remains close to price levels last seen in July 2023. The energy sector and most of its various products are also trading near their lows. While commodities are trending lower in the medium term, technical traders may want to focus on the broader commodity market and note that industrial metals have started to rise slightly since September. While demand certainly remains in doubt as the recession casts a shadow over major economies, speculators are looking for upside as risk appetite appears to point to growth potential for WTI crude. Maybe they think it’s lurking.
- With full trading volume returning on Monday and Tuesday of this week, speculators should brace for the possibility of quick price movements as major players take positions in WTI crude oil.
- The low price reached last Wednesday did not break through to the previous week’s low price for crude oil, and in fact, when it touched around 73.810, strong buying suddenly became clear.
The last week of November could be important for WTI crude oil. There are no isolated asset transactions. This means that WTI crude oil, like all other financial assets, is subject to global risk appetite. If the overall market continues to show signs of buying activity in stocks, WTI oil prices could be perceived as too low. This doesn’t mean the commodity will race to the moon, but it does mean that looking for slight upside potential may be a realistic bet.
The speculative price range for WTI crude oil is $73.700 to $81.200.
Last week’s trading was in a fairly narrow range. Neither the highs nor the lows in WTI crude oil had a significant impact on the broader value area of the previous week. As full trades become the norm again in commodity markets, speculators need to prepare for the possibility of a stronger move. If the support level around 75.000-74.000 from earlier this week proves to be persistent, this could be a signal that additional buying could build up in WTI crude oil. For traders looking to test the downside or support, seeking a break below the 74,000 realm this week may be too adventurous.
While upside is not guaranteed, WTI could find speculative positions aimed at the 76.000 and 77.000 ratios relatively quickly if risk appetite continues to be seen across the market. If these prices are challenged and hold higher, a test of the 78.000-79.000 mark could unfold without too much trouble. Risk appetite remains key in the WTI oil market. Yes, there is a shift risk that adverse conditions could resurface and push commodity prices lower, but optimistic sentiment could encourage buying in WTI crude this week.