Crude Oil Price Update – Move Through $75.27 Resumes Uptrend, Makes $72.14 New Main Bottom

U.S. West Texas Intermediate crude oil futures are trading higher early Monday, driven to the upside by Friday’s late session surge. Prices are being supported by concerns over support, but another reported jump in the drilling rig count may be helping to limit gains. According to Baker Hughes, last week’s oil drilling rig count, an indicator of future production, rose by 5 rigs to a total of 863.

At 0326 GMT, August WTI Crude Oil is trading $74.14, up $0.34 or +0.46%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum may be trying to shift to the downside. A trade through $75.27 will signal a resumption of the uptrend. This move will turn $72.14 into a new main bottom.

The minor trend is down. It turned down on Friday when sellers took out the previous minor bottom at $72.51. A drive through $72.14 will signal a shift in momentum to the downside.

The first support is the major Fibonacci level at $70.51. The main range is $63.40 to $75.27. If the selling pressure continues then its retracement zone at $69.34 to $67.93 will become the next target zone.

The short-term range is $75.27 to $72.14. Its 50% level or pivot at $73.71 is influencing the direction of the market at this time.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at $74.14, the direction of the August WTI Crude Oil futures contract today is likely to be determined by trader reaction to the 50% level at $73.71.

A sustained move over $73.71 will indicate the presence of buyers. If this creates enough upside momentum then look for a test of last week’s high at $75.27.

Taking out $75.27 will reaffirm the uptrend. This could lead to an eventual test of a pair of main tops at $79.72 and $81.09.

A sustained move under $73.71 will signal the presence of sellers. This could trigger a break into last week’s low at $72.14. If this price fails then the next targets are layered at $70.51, $69.34 and $67.93. Since the main trend is up, buyers are likely to start showing up on a test of any of these levels. We’re going to have to watch the price action and read the order flow on a test of these levels to determine the strength of any buying.