Crude Oil Price Forecast: Bullish Breakout Signals Trend Continuation

Pennant Breakout Confirms Trend Continuation

WTI spot crude oil broke out of a pennant pattern on Thursday and triggered a continuation of the rising trend. It reached its highest price of $66.90 since early August. This generated a bullish outside week as well, as last week’s low of $61.89 was broken earlier in the period and it was followed by buyers taking control into a new trend high of $66.90. The trend extension is set to confirm with a close above the prior high of $66.57 from several weeks ago.

200-Day Average Recovery Strengthens Bullish Case

A bullish reversal of an intermediate downtrend triggered in January and the recent consolidation phase was the longest since then. The significance of today’s breakout has increased for a couple reasons. First, the pennant formation formed on support near the 200-day average. This was after crude oil traded below the 200-day average since the beginning of August. A successful recovery and now continuation happens when there is the possibility of the bull trend continuing.

Key Resistance Levels and Breakout Triggers

The net key lower swing high is at the beginning of an internal downswing at $71.33, which defines the top of the downtrend now being reversed. A long-term downtrend line was tested as resistance today with the day’s high of $66.90. That was also another touch of the 50% retracement. This marks the line as a potential breakout could be close. Also, there is an interim lower swing high at $66.77 that will trigger another bullish reversal signal, confirmed on a close above it.

Upside Targets and Weekly Confirmation

Since it is the beginning of the internal downtrend now being reversed, $71.33 is a key upside target for crude oil. Nevertheless, a measured move of the previous advance from the $55.00 sustained price support zone suggests that that most recent lower swing high at $78.44 could eventually be challenged. Crude oil rallied to that high from the April 2025 low. The current advance, from the $55.00 low in December, matches the 2025 rise around $78.50. A weekly closing on Friday above last week’s high of $66.57 will confirm the trend continuation signal on a weekly basis. That will keep crude oil poised toward higher prices.

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