Crude Oil Price Update – Counter-Trend Buyers Trying to Build Support Base at $64.83 Pivot

U.S. West Texas Intermediate crude oil futures are trading nearly flat on Monday as investors await fresh news about the supply/demand situation. The market is trying to bounce back after last Wednesday’s steep sell-off was triggered by a surprise U.S. inventories build. Concerns over falling demand are also pressuring prices. With the impact of the Iranian sanctions apparently being dampened by increased production, it seems that a supply disruption will be necessary to drive prices higher.

At 1235 GMT, October WTI crude oil futures are trading $65.19, down $0.02 or -0.03%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through $63.89 will signal a resumption of the downtrend. The main trend will change to up on a move through $67.72.

The short-term range is $67.72 to $63.89. Its retracement zone at $67.81 to $66.26 is the primary upside target. Friday’s rally stopped at $65.76, just short of the lower or 50% level at $67.81.

The first leg up was $63.89 to $65.76. Buyers are trying to establish support at its 50% level or pivot at $64.83. Today’s low is $64.85. They are going to try to form a secondary higher bottom.

Daily Technical Forecast

Based on the early price action, the direction of the October WTI crude oil market the rest of the session is likely to be determined by trader reaction to the 50% level at $64.83.

A sustained move over $64.83 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to extend into the downtrending Gann angle at $65.72. This is followed closely by Friday’s high at $65.76 and the 50% level at $65.81.

Watch for a technical bounce on the first test of $65.81. If buyers can take out this level then look for a potential acceleration into the Fib level at $66.26. This is another trigger point for an acceleration into the next downtrending Gann angle at $66.72.

A sustained move under $64.83 will signal the presence of sellers. This could lead to a retest of last week’s low at $63.89.