Crude Oil Price Update – Straddling Key 50% Level at $50.23
December West Texas Intermediate Crude Oil futures are trading lower shortly before the opening on Friday. There was no follow-through to the upside following yesterday’s strong surge which suggests the price action was fueled by short-covering rather than aggressive buying.
Daily Technical Analysis
The main trend is up according to the daily swing chart, however, the market has been under pressure since September 28.
The main range is $46.14 to $52.86. Its retracement zone at $50.23 to $49.60 is support. The market has been straddling this zone all week. It is controlling the longer-term direction of the market.
The new short-term range is $52.86 to $59.76. Its retracement zone at $51.31 to $51.68 is the primary upside target.
Taking out $49.76 will indicate the selling is getting stronger. It will also make $51.22 a secondary lower top.
Based on the current price at $50.07 and the earlier price action, the direction of the crude oil market today is likely to be determined by trader reaction to the 50% level at $50.23.
A sustained move under $50.23 will indicate the presence of sellers. This could drive the market into the weekly low at $49.76, followed by the Fib at $49.60 and an uptrending angle at $49.27.
The angle at $49.27 is also the trigger point for an acceleration to the downside with the next target an uptrending angle at $47.70.
Overcoming and sustaining a rally over $50.23 will indicate the presence of buyers. The next target is a resistance cluster at $51.31 to $51.36. This is followed by the Fibonacci level at $51.68.
Intraday, bearish under $50.23. Longer-term, bullish over $50.23, bearish under $49.60.