Crude Oil Price Update – Starts Today’s Session in Window of Time for Closing Price Reversal TopSince momentum is driving the price action, the direction of the November WTI crude oil futures contract on Monday is likely to be determined by trader reaction to Friday’s high at $73.73. Three things can happen today.
November West Texas Intermediate crude oil futures settled higher on Friday, recovering from three days of sideways action. The rally is being driven higher by increasing momentum. Speculators and professional traders are increasing bets that the sanctions on Iran will cause a supply shortage. Although Russia and Saudi Arabia are planning to provide some support through increased production, the 1.4 million barrels per day is not expected to be enough to replace the 2.1 million barrels per day that Iran was expected to provide.
Daily Swing Chart Technical Analysis
The current chart pattern isn’t very complicated because we’re not dealing with resistance at this time, only support. Furthermore, the more is being driven by momentum.
The main trend is up according to the daily swing chart. The main trend will change to down on a trade through $67.79.
The minor trend is also up. A move through $71.47 will change the minor trend to down. This will also signal a shift in momentum to the downside.
Today’s session is 10 days up from the last main bottom. This puts the market in the window of time for a potentially bearish closing price reversal top.
Daily Swing Chart Technical Forecast
Since momentum is driving the price action, the direction of the November WTI crude oil futures contract on Monday is likely to be determined by trader reaction to Friday’s high at $73.73. Three things can happen today.
First, the buying can be strong enough to take out $73.73 and continue the rally. Secondly, the buying may be weak and the selling strong enough to prevent the market from breaking out over $73.73. Thirdly, buyers could take out $73.73 then the market could turn lower for the session. This would set up a possible closing price reversal top. Although this chart pattern does not indicate a change in trend is taking place, it will be a sign that the selling is greater than the buying at current price levels.
If formed and confirmed, this chart pattern could lead to a 2 to 3 day correction.