Crude Oil Price Update – Could Swing on Both Sides of $49.26; Traders Waiting for OPEC News

September West Texas Intermediate Crude Oil futures are trading lower but in a tight range shortly before the regular session opening. The bulls reacted earlier to a reported drop in the number of producing rigs. The bears are reacting to increased U.S. production and higher OPEC exports. Both are waiting to see if anything results from the OPEC/Non-OPEC producers meeting over the next two days. Bullish traders are hoping the cartel and Russia reach an agreement with Nigeria and Libya to limit production.

Technical Analysis

The main trend is up according to the daily swing chart. However, the closing price reversal top on August 1 may have temporarily stopped the rally, triggering a loss in upside momentum.

A trade through $50.43 will negate the closing price reversal top and signal a resumption of the uptrend.

On the downside, support is being provided by a major Fibonacci level at $48.52, followed by a short-term 50% level at $47.92 and a support cluster at $47.33 to $47.32.

An uptrending angle also passes through these zones at $47.90, making it a valid downside target also.

Forecast

Based on the current price at $49.00 and the earlier price action, the direction of the crude oil market today will be determined by trader reaction to the downtrending angle at $49.26.

A sustained move under $49.26 will indicate the presence of sellers. This could lead to a test of $48.52, followed by a support cluster at $47.92 to $47.90.

A sustained move over $49.26 will signal the presence of buyers. The daily chart has room to run if the volume picks up on this move. Potential targets include $50.43 and $50.82.