Crude Oil Price Update – Major Downtrending Gann Angle Comes in at $49.34 This Week

October West Texas Crude Oil futures recovered all of last week’s loss caused by refinery outages in the Texas Gulf Coast area because of Hurricane Harvey. However, by Friday, the market had given up most of last week’s earlier gains.

Traders blamed profit-taking on the sell-off and expectations of lower demand because of Hurricane Irma’s expected impact on Florida.

Weekly Technical Analysis

The main trend is down according to the weekly swing chart. A trade through $50.51 will change the main trend to up for the first time this year.

A move through the minor bottom at $45.58 will signal a resumption of the downtrend and shift momentum back to the downside.

The main range is $58.34 to $42.52. Its retracement zone at $50.43 to $52.30 is major resistance. The lower or 50% of this level of this range stopped the rally six-weeks ago at $50.51.

The short-term range is $42.52 to $50.51. Its retracement zone at $46.52 to $45.57 is the primary downside target. This zone stopped the selling two weeks ago at $45.58.

The short-term retracement zone is very important because aggressive counter-trend buyers are trying to form a potentially bullish secondary higher bottom. Sellers are trying to drive the market through this zone.

Weekly Forecast

Based on Friday’s close at $47.48 and last week’s price action, the direction of the October WTI crude oil market this week is likely to be determined by trader reaction to the long-term downtrending angle at $49.34.

A sustained move under $49.34 will signal the presence of sellers. Holding the market under the uptrending angle at $48.52 will also be a sign of weakness.

If the selling pressure continues then look for a move into $46.52, followed by a support cluster at $45.58, $45.57 and $45.52. We could see a technical bounce on the first test of the support cluster.

If $45.52 fails as support then look for a possible acceleration to the downside with $44.02 the next major target angle.

Overtaking the uptrending angle at $48.52 will be the first sign of buyers this week. Crossing to the strong side of the downtrending angle at $49.34 will indicate the buying is getting stronger. This could generate the upside momentum needed to challenge the main 50% level at $50.43 and the main top at $50.51.

If buyers can take out $50.51, the trend will change to up. This could trigger a rally into $52.30 to $52.50.