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Crude Oil Price Update – Strengthens Over $101.99, Weakens Under $99.77

By:
James Hyerczyk
Updated: May 10, 2022, 06:32 UTC

The direction of the June WTI crude oil market on Tuesday is likely to be determined by trader reaction to $101.99 and $99.77.

WTI Crude Oil

In this article:

U.S. West Texas Intermediate crude oil futures are trading lower on Tuesday but attempting to claw back earlier losses.

Longs are being pressured out of the market as the coronavirus lockdown in China, the runaway U.S. Dollar and growing fears of a recession fueled fears about the outlook for global demand.

However, some buyers are holding out hope for the release of details about an embargo of Russian oil by the European Union.

At 06:03 GMT, June WTI crude oil futures are trading $101.97, down $1.12 or -1.09%. On Monday, the United States Oil Fund ETF (USO) settled at $76.53, down $5.60 or -6.82%.

The focus could shift to the U.S. Dollar on Tuesday as traders continue to prepare for the release of U.S. consumer inflation data later in the week.

After hitting a 20-year high early Monday, the U.S. Dollar fell against a basket of currencies on rumors of a possible intervention by several central banks. A technical correction in the dollar could stop the slide in crude oil since it would likely drive up foreign demand for the dollar-denominated asset.

Daily June WTI Crude Oil

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. A trade through $111.37 will signal a resumption of the uptrend. A move through $95.28 will change the main trend to down.

The minor trend is also up. A trade through $100.28 will change the minor trend to down. This will shift momentum to the downside.

The short-term range is $92.60 to $111.37. The market is currently testing its retracement zone at $101.99 to $99.77. This zone is potential support, having stopped a sell-off at $100.28 on May 2.

The intermediate range is $121.17 to $90.37. Its retracement zone at $105.77 to $109.40 is resistance.

The main support is the longer-term retracement zone at $91.33 to $84.28.

Daily Swing Chart Technical Forecast

The direction of the June WTI crude oil market on Tuesday is likely to be determined by trader reaction to $101.99 and $99.77.

Bullish Scenario

A sustained move over $101.99 will indicate the presence of buyers. If this move creates enough upside momentum then look for a surge into the retracement zone at $105.77 to $109.40. If sellers reject the rally on a test of this zone then start anticipating a change in trend to down.

Bearish Scenario

A sustained move under $99.77 will signal the presence of sellers. The daily chart indicates there is plenty of room to the downside with $95.28 the next likely target.

For a look at all of today’s economic events, check out our economic calendar.

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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