Crude Oil Price Update – Solid Jobs Report Eases Fears Over Lower Demand

U.S. West Texas Intermediate crude oil futures are trading slightly better on Friday, recovering from an early session setback. Pressuring the market were worries over increasing U.S. production and fears of weaker demand on the possibility of a slowdown in the U.S. economy.

The market continued to be underpinned by the OPEC-led supply cuts and U.S. sanctions against Iran and Venezuela, which have cut sharply into global supplies. A better-than-expected U.S. Non-Farm Payrolls report seems to have taken care of worries about a recession.

At 12:38 GMT, May WTI crude oil is trading $62.27, up $0.17 or +0.31%.

Daily Technical Analysis

The main trend is up according to the daily swing chart. The two-day setback has helped make $62.99 a new main top. A trade through this level will signal a resumption of the uptrend. The market isn’t close to changing the main trend to down. A trade through $58.17 will change the main trend to down.

The nearest upside target is the long-term Fibonacci level at $63.45.

The main range is $58.17 to $62.99. If the selling pressure continues then its retracement zone at $60.58 to $60.01 will become the primary downside target.

Daily Technical Forecast

Based on the early price action, the direction of the May WTI crude oil futures contract is likely to be determined by trader reaction to the downtrending Gann angle at $61.99.

Bullish Scenario

A sustained move over $61.99 will indicate the presence of buyers. If this creates enough upside momentum then look for a rally into a downtrending Gann angle at $62.49.

Overtaking this angle will likely drive the market into a resistance cluster at $62.67 to $62.74. Overtaking this area will put the market in a bullish position with a downtrending Gann angle at $62.87 the next target. This is the last potential resistance angle before the $62.99 main top.

Bearish Scenario

A sustained move under $61.99 will signal the presence of sellers. The daily chart is wide open to the downside under this angle. This move could trigger an acceleration to the downside with the next potential targets the 200-Day Moving Average at $60.76 and the 50% level at $60.56.