Crude Oil Price Update – Daily Trend Turned Up Last Week, but Needs to Clear $70.42

Profit-takers stepped in to take advantage of thin trading conditions on Friday, driving U.S. West Texas Intermediate crude oil futures lower for the session. Volume was light, with less than 361,000 U.S. crude contracts changing hands, compared with a 10-month daily average of about 587,000 contracts.

On Friday, September WTI crude oil futures settled at $68.69, down $0.92 or -1.34%.

Although the market finished lower for the fourth straight week, the selling wasn’t as fierce as previous weeks because of support provided by the easing of trade tensions and a temporary shutdown by Saudi Arabia of a key crude oil shipping lane.

Some traders said the selling pressure may have also been related to weakness in the major stock indexes.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through $69.92 will signal a resumption of the uptrend. A move through $67.56 will change the main trend to down.

Friday’s weakness also created a new minor top at $69.92.

The main range is $72.98 to $66.29. Its retracement zone at $69.64 to $70.42 is resistance. This zone stopped the rally on Friday at $69.92.

The major, long-term retracement zone is $67.99 to $66.81. This zone should be considered support.

The short-term range is $67.56 to $69.92. Its 50% level at $68.74 falls between the two bigger retracement zones. Trader reaction to this level could determine the near-term direction of the market.

Daily Swing Chart Technical Forecast

Based on Friday’s close at $68.69, the direction of the September WTI crude oil market on Monday is likely to be determined by trader reaction to $68.74.

A sustained move under $68.74 will indicate the presence of sellers. This could lead to a quick test of $67.99 then $67.56.

The trigger point for an acceleration to the downside is $67.56. Taking out this main bottom could create the downside momentum needed to challenge the Fib level at $66.81 and the main bottom at $66.29.

Overtaking and sustaining a move over $68.74 will indicate the return of buyers. If this creates enough upside momentum then look for targets at $69.64, $69.92 and $70.42. Overcoming $70.42 will put the market in a bullish position.