Daily November West Texas Intermediate crude oil futures are trading sharply lower shortly before the regular session opening. The trigger point for the sharp break was $51.22. The trade through this price confirmed last Thursday’s closing price reversal top.
Daily Technical Analysis
The main trend is up according to the daily swing chart, however, momentum shifted to the downside with the confirmation of the closing price reversal top. A trade through $52.86 will negate the chart pattern and signal a resumption of the uptrend.
The main range is $47.59 to $52.86. Its retracement zone at $50.23 to $49.60 is the primary downside target. Since the main trend is up, buyers are likely to show up on a test of this area.
Daily Forecast
Based on the current price at $50.77 and the earlier price action, look for a bearish tone today as long as the market remains under a steep downtrending angle at $51.86.
The daily chart indicates that sellers have a clean shot at reaching the 50% level at $50.23. We could see buyers on the first test of this level. If it fails then look for another drive into the Fibonacci level at $49.60. This is followed by an uptrending angle at $48.77.
If the selling pressure stops and the market recovers then look for a possible rally back to angles at $51.21 and $51.39. The most important angle comes in at $51.86.
If the downside momentum continues then look for a move to at least $50.23.