Intraday Reversal at New Corrective Low
Crude oil fell to a slightly new corrective low of $69.87 on Thursday, before buyers took back control and drove price higher intraday. That put the price of crude oil 41.7% below the recent March peak of $119.54. However, the next lower target zone of $68.81, as represented by the 78.6% Fibonacci retracement, and a falling trendline, previously marking potential resistance is a little lower, estimated around $67.00 currently. Since support failed at the 200-day moving average on Wednesday, this lower support zone remains a key target zone.
Breakdown Structure and Fibonacci Confluence Zone
Nonetheless, this week’s decline completes a round trip from upside breakout through trendline resistance in early March, near $70.49, to Thursday’s low of $69.87. That breakout initially triggered a multi-year corrective structure that evolved into a broader falling bullish wedge pattern. If support is further confirmed near the initial breakout zone and key support near the 78.6% Fibonacci retracement, then a successful test of prior support as resistance will have completed. That should complete the bearish correction and lead to a higher swing low.
Channel Dynamics and Trend Recovery Conditions
Since there has been only one leg up after the wedge breakout, a second leg up remains a possibility. A falling channel shows the current test of support near the lower boundary of the pattern. If the 200-day moving average is subsequently reclaimed before a new trend low, then a recovery may be underway. After the 200-day, a bullish reversal of trend structure signals above the recent lower swing high of $79.23. The top falling channel boundary represents an initial upside target zone, along with prior support near the lower boundary of a symmetrical triangle.
Momentum Oversold Signal
Supportive of a recovery is the Relative Strength Index (RSI), which has reached its most oversold reading since April 2025. The oversold condition is also represented by the sharp bearish momentum exhibited after the minor swing high of $94.98 from June 11.
Broader Pivot Zone Context
Overall, while downside pressure remains in place following the loss of the 200-day moving average, the interaction between key Fibonacci support, falling channel structure, and deeply relative oversold momentum conditions suggests the current decline may have reached or is close to a key pivot zone.
