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Crude Oil Price Update – Strengthens into Close Over $51.96, Weakens Under $51.22

By:
James Hyerczyk
Published: Jun 6, 2019, 17:42 UTC

Based on the early price action, the direction of the July WTI crude oil into the close is likely to be determined by trader reaction to a downtrending Gann angle at $51.96 and an uptrending Gann angle at $51.22.

Crude Oil

U.S. West Texas Intermediate crude oil futures are trading nearly flat shortly before the early close. The market is trading inside yesterday’s range which suggests investor indecision and impending volatility. It’s also trading slightly below a major technical retracement level that is controlling the longer-term direction of the market.

There were no significant changes to the fundamentals so we have to chalk up the price action to technical conditions and perhaps increasing demand for higher risk assets. There has also been a relative calm in the markets despite lingering concerns over U.S. trade policy. The biggest move this week was to the downside and this was fueled by another surge in U.S. crude oil stockpiles.

At 16:42 GMT, July WTI crude oil futures are trading $51.56, down $0.12 or -0.23%.

WTI Crude Oil
Daily July WTI Crude Oil

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through $50.60 will signal a resumption of the downtrend. The next downside target is the main bottom at $44.20.

The market is in no position to change the main trend to up today, but due to the prolonged move down in price and time, the market is currently inside the window of time for a potentially bullish closing price reversal bottom.

The main range is $44.20 to $66.44. Its retracement zone at $52.70 to $55.32 is controlling the near-term direction of the market. Trading below this zone makes it resistance.

Daily Technical Forecast

Based on the early price action, the direction of the July WTI crude oil into the close is likely to be determined by trader reaction to a downtrending Gann angle at $51.96 and an uptrending Gann angle at $51.22.

Bearish Scenario

A trade through $51.22 will indicate the presence of sellers. Crossing to the weak side of a long-term downtrending Gann angle at $50.94 and yesterday’s low at $50.60 will indicate the selling is getting stronger. This could trigger a potential acceleration to the downside with the next target angle coming in at $47.70. This is the last potential support angle before the $44.20 main bottom.

Bullish Scenario

A sustained move over $51.96 will signal the presence of buyers. This could trigger a rally into the Fibonacci level at $52.70. Overtaking this level could trigger a late session acceleration to the upside.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

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