Crude Oil Offers Excellent Trading Conditions

Trading in WTI and Brent Crude oil and returning a profit requires a level of skill. Commodity traders observe different markets such as crude oil futures and its derivatives to understand the movements in oil price. Trading oil requires an trader to understand general crowd mentality, long-term price action, and the different oil grades.

During the COVID-19 outbreak in 2020, oil prices collapsed to 20-year lows. OPEC agreed with its allies to historic production cuts to stabilize oil prices.

What and who moves oil prices
Crude oil is moved on support and resistance levels that are the result of worldwide oil output. Oversupply and a shrinking demand encourage traders to sell crude oil markets to lower levels while rising demand and declining or flat production encourages traders to bid crude oil up to higher prices.
Herd Mentality
Herd Mentality is when traders follow the direction thy think all other traders are doing. Traders will often follow the herd instead of doing their own research and analysis.
WTI vs Brent Crude Oil
Brent Oil is a blend of crude oil from 15 different oil fields in the North Sea. West Texas Intermediate Oil or WTI is a “light” or “sweet” oil. WTI is preferred for making gasoline although Brent Crude Oil is also acceptable.
The Trend Is Your Friend
This old saying can be especially true when trading Crude Oil as it has a strong tendency to follow the major trend. Breakouts into the larger trend often occur after periods of tight range trading.
Choosing the Right Broker For You
Research is necessary before choosing a broker to begin your commodities trading journey with. Here are some commodity broker options for you to start your search!