FXEMPIRE
All
Ad
Corona Virus
Stay Safe, FollowGuidance
World
59,924,042Confirmed
1,409,813Deaths
41,421,646Recovered
Fetching Location Data…
Advertisement
Advertisement
James Hyerczyk
WTI Crude Oil

U.S. West Texas Intermediate crude oil futures are edging higher on Monday shortly after the regular session opening, ignoring concerns over rising coronavirus cases that are shattering hopes for a smooth recovery in fuel demand.

Traders also seem to be discounting potentially bearish reports that more crude is also being exported from OPEC producers Iran and Libya despite efforts by the Organization of the Petroleum Exporting Countries and their allies to limit output.

At 13:02 GMT, December WTI crude oil is trading $41.02, up $0.51 or +1.26%. The futures contract is headed for its first monthly loss since April as the reimposition of mobility curbs in some countries clouds the outlook on fuel demand recovery.

Despite the bearish outlook, one factor that may offer some near-term support to the market is the prospect of a strike in Norway.

Daily December WTI Crude Oil

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart, however, momentum has been trending higher since the formation of the closing price reversal bottom on September 9.

The main trend will change to up on a move through $44.33. A trade through $37.11 will signal a resumption of the downtrend.

The minor trend is also down. A trade through $42.02 will change the minor trend to up. This will confirm the shift in momentum.

The short-term range is $44.33 to $37.11. Its retracement zone at $40.72 to $41.57 is acting like resistance. It is currently being tested.

The minor range is $37.11 to $42.02. Its retracement zone at $39.57 to $38.99 is support.

Advertisement

Daily Swing Chart Technical Forecast

Based on the early price action, the direction of the December WTI crude oil market into the close on Monday is likely to be determined by trader reaction to the 50% level at $40.72.

Bullish Scenario

A sustained move over $40.72 will indicate the presence of buyers. If this creates enough upside momentum then look for a drive into the short-term Fibonacci level at $41.57.

Bearish Scenario

A sustained move under $40.72 will signal the presence of sellers. If this can create enough near-term momentum then look for the selling to possibly extend into the minor 50% level at $39.57.

Side Notes

We’re expecting the market to trade in a range over the near-term as traders adjust to the expected drop in demand, while continuing to respect the OPEC-led production cuts.

Essentially, we’re looking for resistance inside the retracement zone at $40.72 to $41.57 and support inside the retracement zone at $39.57 to $38.99. We’ll trade the range until a force comes along in the market that tells us not to. That force could be the strike in Norway.

For a look at all of today’s economic events, check out our economic calendar.
Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Trade With A Regulated Broker

  • Your capital is at risk
IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US