Another week has begun, and we are still impressed by the action from last week, as both benchmark crudes put on great performances. We often point to this market’s dynamic behavior, which means that the movements of the crude oil market courses are often very clear, but the prices often move quite rapidly here. It looked like the planned downward movement would set in at the beginning of last week, but that tendency was quickly neutralized.
Instead, a bullish movement started and stretched until last Thursday. The movement closely resembled the pattern of behavior that we have already witnessed in February. Brent and WTI prices ran so far that they exceeded their temporary highs at $68.04 and $64.53, respectively. This was contrary to our primary expectation, but the bears came to our rescue on Friday when they pulled the prices downward again.
Brent and WTI declined in their respective prices and made an alternative development of a prolonged correction less likely, which would have set in if the prices would have risen above $68.04 (Brent) and $64.53 (WTI). Accordingly, both crudes are set for a great week ahead.
Primarily, we expect the crude prices to decline further. The British Brent crude should leave the $68.04 mark behind and move closer towards the support line at $60.26. Once the Brent crude move below that mark, we can surely say that the preliminary high is completed and that we are about also to complete the corrective movement.
The latter should end somewhere between $59.04 and $55.27. There, we expect the end of wave 4 in green to be, which should be followed by massive bullish runs that would ultimately lead us up to prices of $80 and above.
Similarly, we expect the WTI crude, which had a little more challenging time distancing itself from its mark at $64.53. Nonetheless, this must happen as we expect it to move under $57.27. By doing so, we could safely assume that the correction is in full effect. A long-term change in the trend should set in between $56.14 and $52.50.
Equally, we expect prices of $80 and above for this second benchmark crude. In the bigger picture, both crudes should eventually reach heights of $100 and above, followed by even higher prices at above $120 in the long run. That being so, we are even more excited to see the current correction fully unfold and offer us the chance to stock up positions on the long side.