Crude Oil Price Update – Holding $40.56 Could Trigger Acceleration Over $41.83
The direction of the January WTI crude oil market on Monday is likely to be determined by trader reaction to $40.56.
U.S. West Texas Intermediate (WTI) crude oil futures are trading higher on Monday, helped by a report that showed China’s crude oil throughput rose 2.6% in October from a year earlier to its highest-ever level as fuel demand firmed on strong holiday travel.
At 08:05 GMT, January WTI crude oil is at $41.35, up $0.95 or +2.35%
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Prices are also being underpinned by hopes that OPEC+ will hold current output curbs, offsetting concerns about weaker fuel demand due to rising COVID-19 cases and higher production from Libya, but traders caution that gains could be limited since this news may have been fully-priced into the market.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. A trade through $44.33 will signal a resumption of the uptrend. The main trend will change to down on a move through the nearest main bottom at $34.04.
The minor trend is also up. A trade through $40.33 will change the minor trend to down. This will also shift momentum to the downside.
The main range is $44.59 to $34.04. Its retracement zone at $39.32 to $40.56 is support.
The minor range is $43.33 to $40.33. Its 50% level or pivot at $41.83 is potential resistance.
The short-term range is $34.04 to $43.33. Its retracement zone at $38.69 to $37.59 is potential support.
Daily Swing Chart Technical Forecast
The direction of the January WTI crude oil market on Monday is likely to be determined by trader reaction to $40.56.
Bullish Scenario
A sustained move over $40.56 will indicate the presence of buyers. If this creates enough upside momentum then look for the rally to possibly extend into $41.83. Sellers could come in on the first test of this level, but overtaking it is likely to trigger an acceleration to the upside.
Bearish Scenario
A sustained move under $40.56 will signal the presence of sellers. Taking out the minor bottom at $40.33 will shift momentum to the downside. This could trigger a further break into the 50% level at $39.32.
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