Crude Oil Price Update – Closing Price Reversal Top Could Lead to Near-Term Test of $57.37 to $56.78

The main trend is up according to the daily swing chart. However, momentum has been trending lower since the formation of the closing price reversal top at $60.39 on March 21. A trade through this top will negate the closing price reversal top and signal a resumption of the uptrend.
James Hyerczyk
Crude Oil

U.S. West Texas Intermediate crude oil futures are trading lower on Monday at the mid-session, but have recovered substantially from early session weakness that had driven prices to their lowest level since March 15. The market is currently in a position to turn higher for the session.

The early session sell-off was fueled by worries about lower future demand. Concerns began to be raised late last week after the Fed lowered growth forecasts and Germany reported weaker-than-expected factory output. The combination of events triggered a steep drop in U.S. Treasury yields which led to an inverted Treasury yield.

Prices began to recover in sync with a rebound in the stock market as early sellers took profits and weaker shorts covered positions.

At 16:20 GMT, May WTI crude oil futures are trading $59.02, down $0.02 or -0.03%.

Daily May WTI Crude Oil

Daily Technical Analysis

The main trend is up according to the daily swing chart. However, momentum has been trending lower since the formation of the closing price reversal top at $60.39 on March 21. A trade through this top will negate the closing price reversal top and signal a resumption of the uptrend.

The minor trend is down. This move confirms the shift in momentum.

On the upside, the resistance is a 50% level at $59.63. The short-term range is $54.87 to $60.39. Its retracement zone at $57.37 to $56.78 is the primary downside target. Since the main trend is up, buyers are likely to come in on a test of this zone.

Daily Technical Forecast

Given the current price at $59.02 and the intraday momentum, the first upside target is a downtrending Gann angle at $59.39. Overtaking this angle will indicate the buying is getting stronger with the next target a 50% level at $59.63, followed by a downtrending Gann angle at $59.89.

If the selling pressure resumes then we could see a retest of today’s intraday low at $58.17. If this fails then look for the selling to possibly extend into the uptrending Gann angle at $57.62.

Don't miss a thing!

Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All

Top Promotions

Top Brokers