April WTI Crude has Clear Shot at $99.53

U.S. West Texas Intermediate crude oil futures closed nearly unchanged on Wednesday as U.S. officials indicated escalation between Russia and Ukraine was unlikely to result in sanctions on energy supplies from Russia, one of the world’s top oil producers. The market also formed an inside move on the daily chart which tends to indicate investor indecision and impending volatility.

On Wednesday, April WTI crude oil futures settled at $92.10, up $0.19 or +0.21%. The United States Oil Fund ETF (USO) finished at $66.22, up $0.68 or +1.04%.

Oil prices were underpinned on Tuesday on fears that sanctions imposed by Western nations on Russia, after it sent troops into two breakaway regions in eastern Ukraine, could hit energy supplies. But the United States made it clear that sanctions agreed and those which may be imposed will not target oil and gas flows.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through $94.95 will signal a resumption of the uptrend. A move through $87.46 will change the main trend to down.

The market also closed on the strong side of a long-term Fibonacci level at $90.74, making this level support.

Short-Term Outlook

Look for an upside bias as long as April WTI crude oil continues to hold the Fibonacci level at $90.74. Taking out Tuesday’s high at $94.95 will indicate the buying is getting stronger. If this move generates enough upside momentum then look for the buying to possibly accelerate into the June 2014 main top at $99.53.

A downside bias is likely to begin if $90.74 fails as support. If the selling pressure is strong enough then this move could extend into the main bottom at $87.46.