Crude Oil Price Update – Trade Through $69.84 Confirms Monday’s Minor Reversal Bottom

U.S. West Texas Intermediate crude oil futures are trading slightly lower early Tuesday. Gains are being capped by Saudi Arabia’s reiteration that OPEC stands ready to provide enough supply to offset the production lost from the sanctions on Iran. Top crude oil exporter Saudi Arabia has pledged to keep markets supplied despite its increasing isolation over the killing of Saudi journalist Khashoggi.

At 0327 GMT, December WTI crude oil is trading $69.17, down $0.19 or -0.26%.

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart, however, momentum has been trending lower since October 4. A trade through $68.46 will indicate the selling is getting stronger. A move through $67.74 will change the main trend to down. This is followed by the next main bottom at $66.50.

On Monday, the market posted a lower-low, higher-close. This wasn’t quite a stronger closing price reversal bottom, however, a move through yesterday’s high at $69.84 could trigger a breakout to the upside. This move will confirm the chart pattern.

The main range is $66.50 to $76.72. Its retracement zone at $70.40 to $71.61 is controlling the direction of the crude oil market. Trading below this zone is helping to give the market a downside bias. This zone is resistance.

The short-term range is $76.72 to $68.46. Overcoming $71.61 could trigger a rally into its retracement zone at $72.59 to $73.56.

Daily Swing Chart Technical Forecast

Based on Monday’s price action and today’s early trade, the direction of the December WTI crude oil market on Tuesday is likely to be determined by trader reaction to yesterday’s high at $69.84.

A sustained move under $69.84 will indicate the presence of sellers. If this creates enough downside pressure then look for a possible test of yesterday’s low at $68.46.

Taking out $68.46 could trigger a break into $67.74. Taking out this bottom will change the main trend to down with $66.50 the next likely downside target.

A sustained move over $69.84 will signal the presence of buyers. This could trigger a rally into the Fibonacci level at $70.40. This is also a potential trigger point for an acceleration into the 50% level at $71.61.