Crude Oil Price Update – Sustained Move Under $45.34 Could Trigger Break into $43.30 – $42.57

U.S. West Texas Intermediate crude oil futures edged lower on Monday after OPEC and its allies led by Russia postponed talks on oil output policy for 2021 to Thursday, three sources said on Monday as key players still disagreed on how much oil they should pump amid weak demand due to the coronavirus pandemic.

Daily Swing Chart Technical Analysis

The main trend for January WTI crude oil is up. A trade through $46.26 will reaffirm the uptrend. The main trend will change to down on a move through $40.33.

The main range is $58.92 to $26.22. The market is currently trading inside its retracement zone at $42.57 to $46.43. This zone is controlling the longer-term direction of the futures contract.

The minor range is $46.26 to $44.42. Its 50% level at $45.34 could determine the direction of the market the rest of the week.

The short-term range is $40.33 to $46.26. Its 50% level at $43.30 is a potential downside target. It represents short-term value. Since the main trend is up, buyers could come in on a test of this level.

Daily Swing Chart Technical Forecast

The direction of the January WTI crude oil futures contract on Tuesday is likely to be determined by trader reaction to the minor pivot at $45.34.

Bullish Scenario

A sustained move over $45.34 will indicate the presence of buyers. If this move creates enough upside momentum then look for a potential surge into $46.26 and $46.43. Overcoming the latter could trigger an acceleration to the upside.

Bearish Scenario

A sustained move under $45.34 will signal the presence of sellers. Taking out Monday’s low at $44.42 will indicate the selling pressure is getting stronger. This could trigger an acceleration into a pair of 50% levels at $43.30 and $42.57. Since the main trend is up, a break into these levels could attract new buyers.

A move under the major 50% level at $42.57 will be the first sign that the rally is in trouble.

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