Crude Oil Price Update – Inside Move Suggests Investor Indecision, Impending Volatility

U.S. West Texas Intermediate crude oil futures are under pressure for a second session as investors continue to react to yesterday’s U.S. government report that showed a decline in factory orders. This raised concerns over future demand. Low liquidity could also be weighing on prices due to the start of the Asian Lunar New Year. Later today, investors will get the opportunity to react to the latest weekly inventories data from the American Petroleum Institute (API).

At 14:00 GMT, March WTI crude oil futures are trading $54.05, down $0.51 or -0.93%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. A trade through $55.75 will signal a resumption of the uptrend. The main trend will change to down on a trade through $51.33.

The short-term range is $51.33 to $55.75. Its 50% level or pivot is $53.54. This level is controlling the near-term direction of the market

The main range is $42.67 to $55.75. If the main trend changes to down then look for an eventual break into its retracement zone at $49.21 to $47.67.

Daily Technical Forecast

Based on the early price action, the direction of the March WTI crude oil futures contract is likely to be determined by trader reaction to the short-term uptrending Gann angle at $54.33.

Bullish Scenario

A sustained move over $54.33 will indicate the presence of buyers. This is followed by the long-term downtrending Gann angle at $55.04. Overtaking this angle could trigger a rally into yesterday’s high at $55.75.

Taking out $55.75 will indicate the buying is getting stronger. This could trigger a rally into a steep uptrending Gann angle at $56.67. This is a potential trigger point for an acceleration to the upside.

Bullish Scenario

A sustained move under $55.75 will signal the presence of sellers. The next target is the short-term pivot at $53.54. If this price fails then look for the selling to extend into the short-term uptrending Gann angle at $52.83.

The angle at $52.83 is a potential trigger point for an acceleration into the main bottom at $51.33.

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