James Hyerczyk
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U.S. West Texas Intermediate crude oil futures are trading lower late in the session on Friday, but remained in a position to post a strong weekly gain. The market is being supported by signs of economic recovery in the United States and China and a stronger demand outlook from the IEA and OPEC. This week’s EIA inventories report also provided support, helping to offset concerns about rising COVID-19 infections in other major economies.

At 17:09 GMT, June WTI crude oil is trading $63.35, down $0.17 or -0.25%.

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China’s first-quarter gross domestic product jumped 18.3% year on year, official data showed. That followed a big increase in U.S. retail sales and a drop in unemployment claims released Thursday.

Daily June WTI Crude Oil

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum is trending higher. The main trend will change to up on a move through $66.15.

A trade through $57.29 will signal a resumption of the downtrend. This is highly unlikely, but due to the prolonged move up in terms of price and time, the market is inside the window of time for a closing price reversal top.

The short-term range is $67.29 to $57.29. The market is currently testing its retracement zone at $62.29 to $63.47. A failure to hold this area will form a potentially bearish secondary lower top.

The new minor range is $57.29 to $63.94. Its 50% level at $60.61 is potential support.

The main range is $51.04 to $67.29. Its retracement zone at $59.17 to $57.25 is the best support. It’s controlling the near-term direction of the futures contract.


Daily Swing Chart Technical Forecast

The direction of the market into the close on Friday will be determined by trader reaction to $63.37.

Bullish Scenario

A sustained move over $63.37 will indicate the presence of buyers. Overtaking $63.47 will indicate the buying is getting stronger. Taking out the intraday high at $63.94 could trigger a late session acceleration to the upside.

Bearish Scenario

A sustained move under $63.37 will signal the presence of sellers. This could trigger a late session break into $62.29. This is a potential trigger point for an acceleration into the minor pivot at $60.61.

Side Notes

A close under $63.37 will form a closing price reversal top. This won’t change the main trend to down, but if confirmed, this could trigger the start of a 2 to 3 day correction with $60.61 the minimum downside target.

For a look at all of today’s economic events, check out our economic calendar.
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