Crude Oil Price Update – Main Trend Changes to Down on Trade Through $63.10

U.S. crude oil buyers paused on Monday despite an improving global economy. Traders claimed fears of inflation may have offset the good news.

If you watch the weekly charts, you could have seen the weakness coming since the West Texas Intermediate crude oil market posted a potentially bearish closing price reversal top last week.

At 19:18 GMT, May WTI crude oil is trading $65.33, down $0.31 or -0.47%.

On the positive side of the ledger, China’s industrial output growth quickened in January-February, beating expectations, while its daily refinery throughput data rose 15% from the same period a year earlier, data showed.

Despite the good news, the market could be facing some headlines in the near future including increased supply from Iran and the strong possibility that OPEC and its allies will raise output starting in May.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, but momentum has been trending lower since the formation of the closing price reversal top on March 8. Additionally, Monday’s price action suggests a secondary lower top may be forming, which is usually an early indication of an impending change in trend.

The main trend will change to down on a trade through $63.10. A move through $67.79 will signal a resumption of the uptrend.

The minor range is $67.79 to $63.10. Its retracement zone at $65.45 to $66.00 is resistance. This zone essentially stopped the rally at $66.44 earlier today.

The first short-term range is $59.08 to $67.79. Its retracement zone at $63.44 to $62.41 is the primary downside target area.

Daily Swing Chart Technical Forecast

The direction of the May WTI crude oil futures contract into the close is likely to be determined by trader reaction to the minor 50% level at $65.45.

Bullish Scenario

A sustained move over $65.45 will indicate the presence of buyers. The first upside target is $66.00, followed by $66.44. Taking out the latter, will indicate the buying may be strong enough to retest $67.79.

Bearish Scenario

A sustained move under $65.45 will signal the presence of sellers. If this move generates enough downside momentum then look for a break into $63.44, followed by $63.10 and $62.41.