Crude Oil Price Update – Short-Term Pivot at $52.44 Controlling Direction

U.S. West Texas Intermediate crude oil futures are trading lower on Wednesday, shortly before the release of a weekly government storage report. The markets are giving back some of yesterday’s gains in response to worries over the global economy and new forecasts calling for increasing U.S. production. The market, however, is being underpinned by expectations of new stimulus from China’s government.

At 1452 GMT, March WTI crude oil is trading $52.37, down $0.02 or -0.05%.

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through $53.61 will change the main trend to up. This is followed by another main top at $54.98. A trade through $50.66 will signal a resumption of the downtrend.

The short-term range is $53.61 to $50.66. Its 50% level or pivot at $52.14 is controlling the direction of the crude oil market today.

The main range is $42.67 to $53.61. Its retracement zone at $48.14 to $46.85 is the primary downside target.

Daily Technical Forecast

Based on the early price action, the direction of the March WTI crude oil market on Wednesday is likely to be determined by trader reaction to the pivot at $52.44.

Bullish Scenario

A sustained move over $52.44 will indicate the presence of buyers. If this creates enough upside momentum then look for a rally into a downtrending Gann angle at $53.17. Overtaking this angle will indicate the buying is getting stronger with the next target the main top at $53.61.

Bearish Scenario

A sustained move under $52.44 will signal the presence of sellers. The first downside target is the downtrending Gann angle at $51.36. If this fails then look for the selling to extend into the main bottom at $50.66, followed by the major uptrending Gann angle at $50.17.