WTI Crude Oil went into the weekend near the 69.500 USD mark, this as a two week stretch of holiday trading is looking speculators in the eyes as they decide if they want to participate.
The last week of trading provided oil traders with a rather comfortable price range to speculate on WTI Crude Oil. The commodity essentially traded near highs to start last week, peaked on Thursday, and then went into the weekend with an incremental selloff. The price range of WTI Crude Oil the past month has been rather steady with natural cycles via buying and selling causing fluctuations and reversals.
The high for WTI Crude Oil was around 70.600 last week, while the lowest values were seen on Friday around the 68.500 depth as support was tested. The commodity has provided traders with a fairly manageable price range the past month with lows slightly below 67.000 in the first week of December and highs around 71.500 in the third week of November and second week of December. And now holiday trading begins for WTI Crude Oil.
Quiet Markets and a Calm Trading Range
The Trump Effect is in full operational mode in the energy sector. Yes, correct the President-elect still has slightly less than one month before he takes public office. But for all intents and purposes the energy sector is behaving as if Trump’s mandates are in power. The holiday season which will be in full effect by Tuesday of this week means trading volumes will significantly decline. Speculators who are not accustomed to trading during this time of year are strongly advised to reconsider their desire to wager.
Traders who want to participate need to understand WTI Crude Oil will be quiet, potential spreads will be wide via the bid and asks, and that sudden fluctuations which make little sense may appear because of large positions being put into a market that is imbalanced. The current price range of WTI Crude Oil may even get tested, but speculators should not completely trust results they are seeing as a real reflection of current behavioral sentiment.
Decline Going into Holiday Season a Potential Bearish Signal
The ability of WTI Crude Oil to go into the holiday season with an incremental decline is a sign that large players in the commodity are comfortable, and that they also may believe additional selling will develop again. Most large traders will not return for trading until the completion of the New Year’s holiday.
Volumes this week will be thin when WTI Crude Oil is trading, besides being closed for business in the middle of this week.
Traders who insist on wagering on WTI Crude Oil should use entry price orders, have limited targets in mind, but also be on the lookout for potential sudden spikes.
If WTI Crude Oil remains below 70.000 early this week, it could set the table for some selling at the end of this week.
However, due to the absence of large players, traders should view all results this week skeptically, particularly if unusual price action develops momentarily.
WTI Crude Oil Weekly Outlook:
Speculative price range for WTI Crude Oil is 68.000 to 70.750
Trying to bet on the price of WTI Crude Oil this week may provide speculators with rather quiet conditions, but they should not get too comfortable because it is always possible a large player may see an opportunity to act during the holiday season. However, because the price range of WTI Crude Oil has been rather stable the past month, this is likely not going to change this week unless there is some type of surprising news event which causes emotions to suddenly be tested.
Having said that, WTI Crude Oil traders are among the most experienced in the world when it comes to dealing with sudden news. In other words the energy sector is most likely going to be rather calm over the next handful of days. Traders who want to participate will need brokers who have an active platform, allowing for quick decisions that pursue limited moves in what will be quiet conditions.
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