Crude Oil Price Update – In Position to Challenge 200-Day Moving Average at $60.77

U.S. West Texas Intermediate crude oil futures settled higher on Friday after hitting its highest level since November 12. However, the close was below the highest close reached this year on March 20 at $60.23. The high of the session at $60.73 also came in just short of the 200-day Moving Average at $60.77. Trader reaction to this level could determine the longer-term trend.

On Friday, May WTI crude oil settled at $60.14, up $0.84 or +1.42%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed when buyers took out the last main top at $60.39. A move through $58.17 will change the main trend to down.

The minor trend is also up as well as momentum. A trade through $58.20 will change the minor trend to down.

Crude oil finished the session inside the major retracement zone at $59.63 to $63.45. Look for the upside bias to continue as long as the market holds above the lower or 50% level at $59.63. The daily chart indicates there is no resistance until $63.45 so we could see an acceleration to the upside.

The new short-term range is $54.87 to $60.73. If the trend changes to down then look for a potential break into its retracement zone at $57.80 to $57.11.

Daily Swing Chart Technical Forecast

Based on Friday’s price action, the direction of May WTI crude oil on Monday is likely to be determined by trader reaction to the 50% retracement level at $59.63.

Bullish Scenario

A sustained move over $59.63 will indicate the presence of buyers. The next upside target would be the 200-day Moving Average at $60.77.  Overtaking this important level could bring in the fund traders, and this could trigger an acceleration to the upside with $63.45 the next major upside target.

Bearish Scenario

If the rally fails at the 200-day Moving Average then this will signal the absence of fund buyers. This could lead to retest of the 50% level at $59.63. If this level fails then a strong downside bias to develop.