Crude Oil Price Update – Bullish Over $51.24, Bearish Under $51.14

November West Texas Intermediate crude oil futures are trading lower and inside yesterday’s range. On Thursday, the market posted its second closing price reversal top this week. This indicates the selling may be greater than the buying at current price levels.

The inside move also indicates investor indecision and impending volatility. Coupled with the reversal top, it could also be indicating the market is getting ready to shift momentum or investor sentiment to the down side.

Daily Technical Analysis

The main trend is up according to the daily swing chart. However, the potentially bearish closing price reversal top may be indicating a shift in momentum. A trade through $52.86 will negate the chart pattern and signal a resumption of the uptrend with $54.92 the next major target.

A trade through $51.22 will confirm the closing price reversal top. This could lead to a 50% correction of the rally or a 2 to 3 day correction.

The short-term range is $47.59 to $52.86. Its retracement zone at $50.23 to $49.60 is the primary downside target.

Daily Forecast

Based on the current price at $51.33 and the earlier price action, the direction of the crude oil market today is likely to be determined by trader reaction to a pair of Gann angles at $51.24 and $51.14.

Holding above $51.24 will signal the presence of buyers. This could trigger an intraday rally into $52.04. Overtaking this level could trigger a further rally into $52.86 then a long-term downtrending angle at $53.08. The latter is the last potential resistance angle before the $54.92 main top.

A break under $51.24 will be a sign of weakness. Taking out $51.22 will confirm the closing price reversal top. The selling pressure will get stronger if the uptrending angle at $51.14 fails as support.

The chart pattern starts to open up under $51.14 with $50.23 the next target so don’t be surprised by an acceleration to the downside.

Basically, we could see an upside bias develop on a sustained move over $51.24 and for a downside bias to develop on a sustained move under $51.14.