Crude Oil Price Update – Rangebound; Strengthens Over $46.68, Weakens Under $44.95

U.S. West Texas Intermediate crude oil futures are edging higher on Thursday, underpinned by a COVID-19 vaccine rollout in the U.K. and the imminent approval of a vaccine in the United States that could spur a rebound in fuel demand, while a large build in U.S. crude stockpiles last week kept a cap on gains.

At 12:09 GMT, January WTI crude oil futures are trading $45.90, up $0.38 or +0.83%.

Oil prices were also supported by some nervousness after two wells at a small oilfield in northern Iraq were net ablaze in what the government called a “terrorist attack”, though production was not affected.

“While the wells were small, it has raised concerns of further disruptions,” ANZ analysts said.

Finally, today’s early gains suggest that traders have largely shrugged off the unexpectedly large build in U.S. crude stocks in the government report released on Wednesday.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, but momentum is trending lower. A trade through $46.68 will signal a resumption of the uptrend, while a move through $43.92 will change the main trend to down.

The minor trend is down. It turned down on Wednesday when sellers took out $45.14. This move shifted momentum to the downside. The new minor top is $46.24. Taking out this level will change the minor trend to up.

The resistance is the long-term Fibonacci level at $46.43.

The minor range is $43.92 to $46.68. Its 50% level at $45.30 is potential support.

The second minor range is $40.33 to $46.68. Its 50% level at $43.51 is additional support.

Daily Swing Chart Technical Forecast

The direction of the January WTI crude oil market is likely to be determined by trader reaction to $45.30.

Bullish Scenario

A sustained move over $45.30 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to exit into a series of potential resistance points at $46.24, $46.43 and $46.68.

The latter is a potential trigger point for an acceleration to the upside.

Bearish Scenario

A sustained move over $45.30 will signal the presence of sellers. Taking out $44.95 will indicate the selling is getting stronger. This could trigger an acceleration to the downside with the next targets $43.92 and $43.51.

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