Learn How To Do Your Own Crude Oil Price Forecast

Energy costs have wide reaching effects on the global economy. Everything from the price of good and services to transportation rise and fall with the ebb and flow of crude oils prices. No where can this fact be seen more clearly than the lead up and crash of the stock market in late 2007, 2008

That said, it would make sense to track and forecast crude oil prices as part of your high level market analysis process. Fortunately, it is perfect legitmate and effective to apply technical analysis techniques to crude oil prices, making it possible for tradeers to determine near term price movements in crude.

Chartting software for stocks is available all over the internet for free, as well as premium software that gives traders access to a wide variety of technical analysis based indicators. Traders should utilize long term, monthly charts to determine the overall trend in crude oil prices, weekly charts for determinig price patterns, and daily charts for implementing technical indicators.

Crude oil is a fantastic commodity for the novice trader to follow in order to learn technical analysis. Price tend to trend more often than not in crude, making it very easy to forecast and trade profitably. For example, crude oil has been in a stead uptrend since early 2009. In fact, savy traders could have easily doubled their investment just by trading crude to the upside.

Crude oil also tends to trade in channels and triangles. A break above or below these pattern lines suggests a large move is comming in crude. As of the writing of this article, crude oil recently crossed above its' 200 day exponential moving average, as well as broke out of the topside of a symetrical continuation triangle. With little resistance overhead, it is quite reasonable that crude oil will continue to rise from it's current price of $83 / barrel, to over $96 per barrel.

As a technical trader, I usually don't spend much time talking about market fundamentals. However, there are some underlying forces that can never be ignored when doing market forecasts. Clearly the price of crude oil has had a profound effect on the stock market over the past 5 years.

You can clearly see that $70 crude oil caused the markets to slow down, eventually creating the tell tale double top. Once crude crossed $90 per barrel, the S&P 500 crashed through the 1400 support level, and the previous bull market which lasted nearly 6 years came to a screeching halt. Will it happen again? It's quite possible.


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Traders, follow along with professional trend trader Steve Warshaw as he provides Crude Oil Price Forecasts, as well as overall market commentary