Crude Oil Price Update – Bullish Over $66.34, Bearish Under $65.39Based on the early trade, the direction of the August WTI Crude Oil market is likely to be determined by trader reaction to the 50% level at $66.34.
Crude oil prices are being pressured on Wednesday, shortly before the regular session opening and the U.S. Energy Information Administration’s weekly inventories report at 1430 GMT. The EIA report is expected to show a 1.4 million barrel draw down.
At 1200 GMT, August WTI Crude Oil is trading $65.94, down $0.34 or -0.50%.
Earlier in the session, the market was pressured by a mixed American Petroleum Institute report. The report showed a smaller than expected crude oil inventories draw, but a much larger gasoline inventories build.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart, however, momentum is trending higher. A trade through $64.15 will signal a resumption of the downtrend.
The minor trend is up. This is why momentum is now trending higher. A trade through $64.79 will change the minor trend down and shift momentum to the downside.
The short-term range is $64.15 to $66.62. Its retracement zone at $65.39 to $65.10 is the primary downside target, followed by the major 50% level at $64.67. Aggressive counter-trend buyers may come in on a test of this zone in an effort to form a secondary higher bottom.
The intermediate range is $68.52 to $64.15. Its retracement zone at $66.34 to $66.85 is acting like resistance. Sellers are coming in on a test of this zone because the main trend is down.
The main range is $72.70 to $64.15. If there is a breakout over $66.85 with well-above average volume, we could see a rally into its retracement zone at $68.43 to $69.43.
Daily Swing Chart Technical forecast
Based on the early trade, the direction of the August WTI Crude Oil market is likely to be determined by trader reaction to the 50% level at $66.34.
A sustained move under $66.34 will indicate the presence of sellers. If this generates enough downside momentum then look for a retest of $65.39. If this price fails then the selling could extend into $65.10, $64.79 and $64.67. The latter is the trigger point for an acceleration into $64.15.
Overcoming and sustaining a move over $66.34 will signal the presence of buyers. This could trigger a spike into $66.62 then $66.85.
The daily chart indicates there is plenty of room to the upside over $66.85 with the next major target coming in at $68.43 to $68.52.