Crude Oil Price Update – Headed into Major Support Zone at $72.35 to $70.86Based on the current price at $73.35, the direction of the November WTI crude oil futures contract is likely to be determined by trader reaction to the steep downtrending Gann angle at $73.90.
U.S. West Texas Intermediate crude oil futures are under pressure shortly before the regular session opening on Monday. The catalysts behind the selling pressure are a report that the Trump administration is considering waivers on sanctions, and rumors or “chatter” that Saudi Arabia plans to replace all of Iran’s lost oil.
At 1105 GMT, November WTI crude oil is trading $73.35, down $0.98 or -1.32%.
Daily Technical Analysis
The main trend is up according to the daily swing chart. However, momentum is trending lower. A trade through $76.90 will signal a resumption of the uptrend. The main trend will change to down on a trade through $67.79.
The minor trend is down. This is why momentum shifted to the downside. The next minor bottom target is $71.47.
The minor range is $71.47 to $76.90. Its 50% level or pivot is $74.19. Trading on the weak side of this pivot is also putting pressure on crude oil.
The main range is $67.79 to $76.90. Its retracement zone at $72.35 to $71.27 is the primary downside target. Since the main trend is up, buyers are likely to come in on a test of this zone. Additional support is the major long-term Fibonacci level at $70.86.
The Fib levels combine at $71.27 to $70.86 to produce the best downside target.
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Daily Technical Forecast
Based on the current price at $73.35, the direction of the November WTI crude oil futures contract is likely to be determined by trader reaction to the steep downtrending Gann angle at $73.90.
A sustained move under $73.90 will indicate the presence of sellers. If this creates enough downside momentum then look for the selling to extend into the 50% level at $72.35.
If $72.35 fails then look for a break into the uptrending Gann angle at $71.79, followed by a pair of Fibonacci levels at $71.27 to $70.86.
Since the main trend is up, watch for buyers to return on a move into $72.35 to $70.86.
Overcoming $73.90 will signal the presence of buyers. This could lead to a rally into $74.19. This is a potential trigger point for an acceleration into the next downtrending Gann angle at $75.40.