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Crude Oil Price Update – Needs to Hold $60.42 or Reversal Top Could Form

By:
James Hyerczyk
Published: Jan 2, 2018, 13:51 UTC

Based on the current price at $60.49 and the earlier price action, the direction of the WTI crude oil market will be determined by trader reaction to Friday’s close at $60.42.

Crude Oil

February West Texas Intermediate crude oil futures are trading higher shortly after the U.S. opening. The market is being supported by the OPEC-led supply cuts and last week’s Libyan pipeline explosion. Prices are being driven higher by unrest in in Iran. Gains may be limited by the resumption of full operations in the North Sea at the Forties pipeline system.

WTI Crude Oil
Daily February WTI Crude Oil

Daily Technical Analysis

The main trend is up according to the daily swing chart. However, the market is up 11 days from its last main bottom, which puts it in the window of time for a potentially bearish closing price reversal top. This may not mean the trend is getting ready to change to down, but it could trigger a short-term shift in momentum to the downside.

On the upside, the next major target is the July 14, 2015 main top at $62.02. On the downside, support is a series of former bottoms at $58.99, $58.90 and $58.60.

Daily Technical Forecast

Based on the current price at $60.49 and the earlier price action, the direction of the WTI crude oil market will be determined by trader reaction to Friday’s close at $60.42.

Holding above $60.42 will signal the presence of buyers. Breaking back below this level will indicate the selling is greater than the buying at current price levels. Closing below this level will form a closing price reversal top. This could trigger a near-term break into a support cluster formed by a pair of old bottoms at $58.99 and $58.90 and an uptrending Gann angle at $58.86.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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