Crude Oil Price Update – Momentum Will Shift to Upside Through $65.82, Watch for Spike Move

August West Texas Intermediate crude oil futures are trading slightly better on Wednesday, helped by a friendly American Petroleum Institute inventories report.

The news about the outcome of the OPEC meeting in Vienna on June 22-23 remains unchanged. Traders expect Saudi Arabia and Russia to push for an increase in production, but investors aren’t sure of the size of the increase nor the timing. Additionally, the two oil producing powerhouses are expected to face opposition from Iran, Iraq and Venezuela, who are expected to exert their veto power in an effort to maintain the current production cuts.

Later today at 1430 GMT, the U.S. Energy Information Administration is expected to announce a 2.1 million barrel draw in inventories.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through $67.03 will change the main trend to up. A move through $63.40 will signal a resumption of the downtrend.

Trader should also watch the reaction on a trade through $65.82 because this move will confirm Monday’s closing price reversal bottom. This will shift momentum to the upside.

Currently, crude oil is straddling a series of retracement levels at $64.67, $65.22 and $65.64. This is helping to maintain the sideways price action today.

Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the August WTI crude oil market today will likely be determined by trader reaction to the 50% level at $65.22.

A sustained move over $65.22 will indicate the presence of buyers. However, in order to fuel a potential breakout to the upside, buyers are going to have to overcome a Fibonacci level at $65.64 and yesterday’s high at $65.82.

Taking out $65.82 could trigger an acceleration into $67.03 then $68.05.

A sustained move under $65.22 will signal the presence of sellers. This could drive prices back to $64.67. This is the trigger point for an acceleration to the downside with $63.40 the next target.