Crude Oil Price Update – New Minor Bottom at $59.45, First Upside Target Angle at $62.55

U.S. West Texas Intermediate crude oil futures are getting a boost on Monday from a report that Saudi Arabia is planning to cut exports by 500,000 barrels per day in December. Additionally, there are reports that OPEC and non-OPEC producers are in early discussions to cut as much as 1 million barrels per day of production. The news is triggering some light short-covering.

At 1425 GMT, January WTI crude oil futures are trading $60.93, up $0.57 or +0.95%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through $59.45 will signal a resumption of the downtrend with $59.34 the next target, followed by $57.09.

The minor trend is also down. However, a new minor bottom has formed at $59.45. A trade through $64.14 will change the minor trend to up.

The 200-Day Moving Average is $65.07. Buyers would have to overcome and sustain a move over this moving average in order to attract aggressive hedge fund buying.

Daily Technical Forecast

Based on the early price action, the support is $59.45 to $59.34. If the early strength generates enough upside momentum then the first target will be the steep downtrending Gann angle at $62.55. Since the main trend is down, look for sellers on the first test of this angle.

Overtaking the downtrending Gann angle at $62.55 will indicate the buying is getting stronger. This could generate the upside momentum needed to challenge the minor top at $64.14 and the 200-Day Moving Average at $65.07.

Traders leaning to the upside have to be patient. The shorts have to be driven out of the market before the new longs will be allowed to take control.